Here is a brief excerpt from an interview of Alex (“Sandy”) Pentland by Scott Berinato for Harvard Business Review and the HBR Blog Network. To read the complete article, check out the wealth of free resources, obtain subscription information, and receive HBR email alerts, please click here.

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Big data and the “internet of things”—in which everyday objects can send and receive data—promise revolutionary change to management and society. But their success rests on an assumption: that all the data being generated by Internet companies and devices scattered across the planet belongs to the organizations collecting it. What if it doesn’t?

Alex “Sandy” Pentland, the Toshiba Professor of Media Arts and Sciences at MIT, suggests that companies don’t own the data, and that without rules defining who does, consumers will revolt, regulators will swoop down, and the internet of things will fail to reach its potential. To avoid this, Pentland has proposed a set of principles and practices to define the ownership of data and control its flow. He calls it the New Deal on Data. It’s no less ambitious than it sounds. In this edited conversation with HBR senior editor Scott Berinato, Pentland talks about how the New Deal is being received and how it’s already working—in a little town in the Italian Alps.

How did you come to be concerned about data collection and privacy?

In my research at the Media Lab, I use wearable sensor technology that measures tone of voice, movement, gesticulation—innate behaviors—to collect very personal data about how people communicate with one another. When I started that work, I was impressed by the power of the data being generated, but I also saw very quickly how it could be abused.

Collectively, we now have data that could help green the environment, create transparent government, deal with pandemics, and, of course, lead to better workers and better service for customers. But obviously someone or some company can abuse that.

And the Internet of things exacerbates this concern?

I think so. Data is data, regardless of how it’s generated. If anything, the Internet of things helps people see what they’re actually doing. When you pick up the kids, how fast do you drive? How much food do you eat in a week? How much time do you spend in your kitchen? In your bedroom? Data points like these make people feel invaded. As sensors are built into more and more products, there’s a sense of being increasingly spied on.

So when consumers become aware of data collection, they start to ask, “Is it really okay that I’m letting a company collect information about my workouts and heart rate?”

Yes. And some consumers may decide they’re fine with it. But right now there’s no notification that people are spying on you, collecting data. It’s a big, ongoing battle among industry and regulators and consumer groups: Do you have the right to know what people are collecting?

You believe that people do have a right to know. How did the idea of the New Deal on Data form?

I thought we needed to create a win for customers and citizens, a win for companies, and a win for government. In 2008 I wrote a policy piece for the World Economic Forum, which continued as a series of meetings and follow-up pieces. It laid out the power of this data, and the disaster scenarios, and the idea of a total reset: the New Deal on Data.

The term “New Deal” has historical resonance and connotes huge ambition. Was that deliberate?

Yes—that’s exactly why I chose it. The original New Deal in the United States was a reset, and it turned out to be a pretty good thing for at least 50 years. It really changed the way people thought.

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Here is a direct link to the complete interview.

Please click here.to join Alex (“Sandy”) Pentland to talk about the Internet of things and privacy.

Professor Alex ‘Sandy’ Pentland is a pioneer in organizational engineering, mobile information systems, and computational social science. Pentland’s research focus is on harnessing information flows and incentives within social networks, the big data revolution, and converting this technology into real-world ventures. His work provides organizations with better management tools and better ways to interact with their customers.

To learn more about him and his work, please click here.