Data brokering has evolved into a multi-billion-dollar industry, where the personal information of millions worldwide is collected and traded. This practice aims to drive corporate growth by promising enhanced consumer experiences. However, it often raises significant privacy concerns.

A data broker collects information from various sources, processes it, and then sells or licenses it to other parties for profit. Unfortunately, these activities can involve invasions of privacy, such as gathering data without consent and selling it to third parties. This has led to increasing worries about how personal data is used—or misused—and has prompted greater scrutiny of data brokers’ practices. Stricter regulations are being implemented to protect personal information. Understanding the history and trends of this industry can help individuals better safeguard their privacy.

While personal tools like VPNs can help protect some of your data, broader efforts are often led on a state-by-state basis. We’ve explored which states are at the forefront of this movement.

An Overview of the Data Broker Industry

Data brokering is a global and rapidly expanding industry. According to Knowledge Sourcing Intelligence, it is expected to grow at a compound annual growth rate of 7.58%. The industry is projected to reach a market size of $561 billion by 2029, a significant increase from the anticipated 2024 value of $389 billion.

The industry lacks transparency, making it difficult to determine the exact number of data brokers. Not all states or countries require them to register. Estimates suggest there are around 5,000 data brokers operating globally, with 1,711 registered in the U.S. alone. It’s likely that more exist but are not yet required to register under current state laws.

Research from the NATO Strategic Communications Centre of Excellence indicates that there are approximately 4.8 billion internet users worldwide, though some estimates are even higher. This vast number of users creates immense opportunities for data collection. IDC research predicts that by 2025, 175 zettabytes—the equivalent of 175 trillion gigabytes—of data will be produced globally. Currently, it’s estimated that there are ten million open datasets publicly available for download.

How Data Brokers Operate

Data brokers gather information from online activities such as social media, online gaming, loyalty programs, medical records, public records, and website registrations. They also collect data from GPS location tracking and various forms of communication. This data is already being tracked by apps on your phone, stores and businesses you’ve signed up with, banks, and even government agencies.

By scraping, collecting, or purchasing your data, data brokers create personal profiles for you and millions of others. These profiles are then sold or licensed to other organizations for purposes like marketing, advertising, business analysis, risk assessment, and customer management.

There are risks associated with having your personal information handled and traded by data brokers, including:

• Violation of Privacy: Data can be collected without user consent.

• Unwanted Advertisements: Personal data can be used to create targeted ads, which may involve political manipulation.

• Data Exposure: Poor storage security by data brokers can lead to personal information being exposed and potentially used for criminal activities.

• Exploitation: Users may be targeted with spam, phishing attacks, or identity theft.

• Data Abundance: Excessive data collection can lead to the creation of inferential profiles that lack accuracy, invade privacy, and result in discrimination.

• Lack of Oversight: Data brokers may not control how their clients use the sold or licensed data.

• Transparency Issues: The industry often lacks transparency, and user consent is frequently overlooked.

Leading Data Broker Companies in the U.S.

The largest data broker company in the United States is Experian, a well-known credit bureau. Experian maintains a consumer database of over 300 million individuals and 126 million households. Its ConsumerView U.S. database contains thousands of data points, providing potential buyers with insights into Americans’ demographics, personal interests, consumer behaviors, and credit information—a vast repository of data and analytics.