Online Loyalty Signing On in Europe

A consortium of German companies is building a privacy-focused single sign on platform to take on American giants like Facebook and Google.
Europe enters the single sign on market.

A consortium of German companies that includes Allianz, Axel Springer, Daimler and Deutsche Bank is setting up a single sign-on platform that will allow users to use one login for a range of online services.

The group, which includes card provider Here and digital consulting company Core, wants to take on the US tech giants such as Facebook and Google that encourage its users to use their portals to login to a wide range of external services.

The idea is simple: One click, and you can pull up your online banking account to check sales, order a newspaper subscription, shop or rent a car through a car sharing service – all without having to complete cumbersome registration procedures.

The platforms distinguishing feature will be the careful use of users' privacy. "We want users to retain control over their data, or to give it back to them," said Mirko Schiefelbein, who heads the research institute at the Core think tank and is involved in designing the platform.

Mr. Schiefelbein said the platform is expected to take the new European Union Data Protection Directive into account, which companies are required to implement by 2020. The directive is intended strengthen the rights of citizens throughout the European Union.

The platform is also intended to enable secure communication, for example for citizens who interact with authorities virtually. It may also expand into financial services. The consortium is looking for more partners from the business sector. Talks are currently underway with Deutsche Telekom.

Axel Springer chief executive Mathias Döpfner said that as a digital publishing house, his company needed user-friendly registration for its services. And Manfred Knof, head of Allianz’s German operations, said the initiative would not compromise security or financial security for its digital financial services.

The platform will need some time to get off the ground. The consortium accepts it needs the the approval of antitrust authorities, and the actual technology is not yet ready. Furthermore, the technology isn't ready yet and initial functions are not expected to be available until late 2017 or early 2018.

The consortium has not yet released numbers for the project, or elaborated on its strategy but if it succeeds it will provide a competitive, European response to the international platform economy.

"We are currently dealing with a market with a tendency toward the formation of monopolistic structures," Mr. Schiefelbein said. The aim, he said, is "get competition going in the first place."

Mr. Schiefelbein said that building a platform based on European standards and ideals is more than economic project, it is a political one.

The Fraunhofer Fokus Institute is involved in the project, while the Economics Ministry has indicated that it welcomes the initiative.

But Axel Oppermann, founder and CEO of consulting firm Avispador, said that while the initiative is a good one, it is "a few years too late."

He said everyone has tacitly come to accept the notion that their data are being commercialized and has become difficult to move users away from established services. Mr. Oppermann also raises the question of how user-friendly the planned integration of the identity card function to comply with data privacy rules will be.

 

Christof Kerkmann is an editor for Handelsblatt and writes about the technology sector. To contact the author: [email protected]