Asymmetric information: Apple pledges to improve transparency on how consumers' data is used by tech industry

To mark Data Privacy Day, Apple have released a report that explains how our personal data is monetised by the $227bn-a-year data industry.

This move is part of Apple's wider strategy to bolster its reputation as a technology company that places the privacy of its users at the forefront of its strategy. This move is, in part, due to recent scandals at Facebook, such as the Cambridge Analytica affair, which has heightened the attention paid by consumers to how their data is used.

Apple appreciates that many individuals don't have the time to read Privacy Policies for every business they interact with and so are introducing a 'privacy nutrition label' for each app on its App Store. This will require apps to display easy to digest information on their privacy practices, such as whether a person's usage will be tracked or linked to them.

Apple has a vested interest in reducing the information asymmetry that exists between consumers and tech firms when it comes to the usage of data. By giving individuals the ability to opt out of data tracking on their Apple devices, competitors such as Google and Facebook may lose out on a huge amount of data that helps to drive their advertising revenues.

This is an interesting example of an industry-led approach to tackle a form of market failure and could be pre-emptive of future regulation in the area of data privacy.