Home Should Tech Companies Be Transparent?

Should Tech Companies Be Transparent?

How much of your data is Facebook really collecting? What does Netflix take into consideration when recommending movies and TV shows to you? Is Apple really slowing down your iPhone on purpose?

It’s hard to answer these questions definitively because we don’t have all the answers. And we don’t have the answers because big tech companies like these haven’t provided them to us. In a world with more tech transparency, these might be non-issues; we might have full access to all relevant information for how the company works and how it interacts with us.

Transparency is valuable in many contexts, building trust, improving the transmission and understanding of information, and increasing accountability. But is a more transparent tech industry something we really want?

Motivations for Low Transparency

It’s easy to position tech companies as being evil or nefarious for one simple reason: like all companies, they operate in their own self-interest. Google, Apple, Netflix, and other giants don’t particularly care about your wellbeing as an individual – they only care about you to the extent that you can help them generate a profit in the long run.

However, self-interest isn’t the same as malice or bad intent. When companies intentionally hide some piece of information, it isn’t exclusively to disguise wrongdoing or intentionally mislead people.

Take, for example, Google’s hidden search engine algorithm. We’re able to deduce a lot about how Google ranks websites in search engine optimization (SEO); we even have an abundance of tools that can help you figure out your rankings and how to improve them. But Google itself has never fully disclosed how its search engine algorithm works, beyond helpful hints for making a better website from scratch.

Why is this the case? Is Google intentionally sabotaging websites by hiding information? No. Instead, Google withholds this information for the sake of improving user experience. If the algorithm was publicly accessible, companies and individuals could easily find ways to cheat the system, manipulate their rankings, and eventually attain visibility despite not having much actual relevance or authority in a chosen field.

There are several good reasons why tech companies would prefer a low transparency environment, such as:

  • Integrity and value. First, low transparency could be critical for preserving the integrity and value of the tech product or service being provided. This is often a hard case to make, especially when the operation in question has no significant impact on the end-user. But in some conditions, this truly is vital. Google Search is the best example; keeping at least some aspects of the algorithm under wraps is a practical necessity to avoid exploitation.
  • Security. Security is a top priority for most tech companies, and it’s only going to grow in importance. In the future, when technology becomes even more integrated into our daily lives (such as influencing our vehicle control and navigation), security is going to become an even greater concern. Preserving security is about keeping users happy, saving money, improving efficiency, and maintaining a good reputation with the public. In most situations, opaqueness can be a benefit for your security strategy; if people don’t know how your technology works, they’ll have a harder time getting control over it. However, the reverse can also be true; in open-source communities, security is often robust because more people can discover flaws and correct them before it’s too late.
  • Competitive resistance. Some companies undoubtedly resist calls for transparency because they want to guard their proprietary secrets. This is certainly understandable; companies and individuals have the right to protect their intellectual property from plagiarism or infringement. That said, copyright and trademark laws aren’t contingent upon whether or not the information is publicly available; tech companies could presumably reveal how their technology works and still sue someone who tries to copy it to make money.
  • Change tolerance and efficiency. Most tech companies pride themselves on constantly updating. They come up with new features, get rid of old bugs, improve security, and streamline things to make the coding more efficient. These changes tend to unfold on an almost constant basis, so if they were always exposed to public scrutiny or some kind of approval process, it could really slow things down. Some companies resist transparency simply to keep things efficient, streamlined, and unimpeded.
  • Inaccessibility. Artificial intelligence and machine learning algorithms are notoriously complex. In fact, in many cases, the developers themselves don’t fully understand how they work. AI and ML operations occur in a “black box,” with systems learning to recognize patterns and make judgments without human knowledge. In these scenarios, complete transparency is practically impossible.

Arguments for Greater Transparency

Of course, the arguments for greater transparency in the tech industry are numerous, including:

  • Fewer opportunities for exploitation, fraud, and other crimes. Lack of transparency makes it easy to hide controversial or illegal actions. If more information is reported and publicized, it’s harder to get away with these actions.
  • Public knowledge and consent. You can sign up for a free account with most big tech providers and start using their products immediately. But do you really know what you’re getting yourself into?
  • Inspiration and innovation. Revealing the inner working of major tech platforms could also serve to inspire entire generations of entrepreneurs to take those formulas and use them to innovate further.

Options for Transparency

Transparency may seem like a good idea overall, but its implementation leads to further complications.

  • Voluntarism. Transparency does have some natural, inherent benefits for organizations that practice it. Greater public trust, competitive differentiation, and higher employee morale are just the start. Unfortunately, we already benefit from this voluntaristic situation, so it’s simply not enough for many proponents of transparency.
  • Governmental pressure or regulations. The most frequently described solution is some form of government intervention. For example, politicians could impose new laws or regulations that force tech companies to disclose certain things to the public, or other items to lawmakers or a regulatory body. But what, exactly, do they have to disclose? Who is responsible for collecting and reviewing this information? What are the consequences of a breach of this arrangement? Are certain types of information, such as information related to security, exempt? This is a complicated route, and one that could have long-lasting consequences – such as limiting the rate of innovation and competition in the industry, spurring stagnation and the formation of monopolies.
  • Public pressure. We could avoid imposing new laws by utilizing public pressure. Public pressure itself can come in many forms, including anything from refusing to buy the latest smart speaker to holding a massive protest outside a tech company’s building. Tech companies have proven that they care deeply about public sentiment and will often make sacrifices or reverse former stances to appease the masses. If sufficiently organized and insistent, a loud group of people could motivate tech companies to disclose more information about specific activities – especially if backed by a real threat of boycott.
  • Competitive pressure. It’s hard to create competitive pressure artificially, but it can be a natural, reinforcing byproduct of any of the systems referenced above. If more companies opt to operate transparently, the competitive pressure alone could encourage tech brands to take action – just to keep pace with their rivals.

The Bottom Line

So what’s the bottom line here? Should we all be banding together and pushing tech companies to be more transparent in their daily operations? Should we favor governmental policies that put pressure on tech companies to reveal more information?

You’ll find people who insist that “sunlight is the best disinfectant” and that transparency is an inherent good that should be imposed on all tech companies. You’ll also find people who insist that protecting proprietary secrets and preserving both free innovation and operational efficiency are vital.

The truth is that the subject of tech transparency is complex, with few straightforward, simple answers. In light of this, we should avoid making sweeping judgments or blanket changes to the industry.

Image Credit: Ron Lach; Pexels; Thank you!

About ReadWrite’s Editorial Process

The ReadWrite Editorial policy involves closely monitoring the tech industry for major developments, new product launches, AI breakthroughs, video game releases and other newsworthy events. Editors assign relevant stories to staff writers or freelance contributors with expertise in each particular topic area. Before publication, articles go through a rigorous round of editing for accuracy, clarity, and to ensure adherence to ReadWrite's style guidelines.

Timothy Carter
Chief Revenue Officer

Timothy Carter is the Chief Revenue Officer of the Seattle digital marketing agency SEO.co, DEV.co & Law.co. He has spent more than 20 years in the world of SEO and digital marketing leading, building and scaling sales operations, helping companies increase revenue efficiency and drive growth from websites and sales teams. When he's not working, Tim enjoys playing a few rounds of disc golf, running, and spending time with his wife and family on the beach -- preferably in Hawaii with a cup of Kona coffee. Follow him on Twitter @TimothyCarter

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