Single sign-ons, also known as SSOs, appear to make things easier for everyone. In a perfect world, you no longer have to rack your brain for that complicated password you hastily made five months ago. Just sign in with your Facebook, Twitter, or Google account and you’re exactly where you left off. You can even skip the annoying signup process completely by using a single sign-on, making typing in your address, email, and phone number for the millionth time a thing of the past.

Yet customers aren’t the only ones benefiting from single sign-on. SSO allows companies like Facebook and Google to develop detailed user profiles to share with their partners and advertisers. This makes mining and selling customer data significantly easier. However, some consumers have caught on to this process, making them hesitant to log in, sign up, and even make purchases. Here’s what you need to know about the trends and concerns so you can be conscious of what tools are available and what values are important to your customers.

A Brief History of the Single Sign-On

The History of OpenID

One of the earliest providers of SSO technology was the non-profit foundation OpenID, developed in 2005 by LiveJournal creator Brad Fitzpatrick. OpenID provides users with a personalized URL that can be used to sign into websites without a password. OpenID partners create user URLs by default, so if you have an existing Google, Yahoo!, or WordPress account, you already have an OpenID.

Many retail and SaaS (software as a service) websites are now using Facebook and Twitter to gain access to their customers’ information. It definitely makes things easier for the user, but social networks have faced backlashes concerning what they do with user information, sparking controversies and lawsuits.

SSO is woven into every aspect of Google — within its own applications (Gmail, Calendar, Drive, YouTube) as well as with Google Apps for businesses and education. Google’s hold on the entire Internet and dizzying technological aptitude has made it extremely easy to follow users from site to site, tracking their moves.

The Big Brother We Love

About a year ago, Google rolled out a new privacy policy, implementing default settings that followed users and their identities across its various web properties.

Google claims the new policy was put in place to benefit the user, but it is also advantageous to Google and its partners. This policy allows Google to connect the dots for all users — linking their search queries to the YouTube videos they’re watching and to keywords in their emails.

Let’s say, for example, that you’re planning a vacation to Costa Rica. You’ve Googled the best resorts, watched YouTube videos of tourists zip-lining through the jungle, and emailed your spouse with the details. All of these activities are being tracked and associated with your identity, allowing Google to narrow the ads you’re served. If you’re a marketer, this technology allows for more efficient media buys and reduces wasted impressions.

The policy also states that Google will be collecting user information in a database, providing more accurate search results and more relevant advertising to users. But some concerned citizens and privacy activists say the database is ready to be handed over to marketing and sales firms for profit. Even taking all of this into consideration, most users are unaware of or indifferent to Google’s capabilities.

Preventing Password Fatigue With Social Sign-In

Creating and remembering passwords is a modern-day inconvenience. According to Fox Business, one third of Internet users have more than 10 unique passwords to remember. Social sign-ins allow those people to sign into their accounts using their existing social networks, fighting off the password fatigue that often comes with creating and remembering multiple passwords.

Yet social networks are using social sign-in for more than just a streamlined process. Last fall, Facebook made headlines when it partnered with a third-party data mining company called Datalogix. It utilized features like social sign-in to track user purchases in an attempt to measure and communicate the effectiveness of its advertisers’ campaigns.

Facebook wasn’t trying to hide its activities, but some claimed it was still in breach of a previous settlement that required Facebook to be “abundantly clear of its intention” to share user information. Facebook users are responsible to themselves to know what they’re signing up for when they join the free service, however.

Should We Be Worried?

This type of constant surveillance doesn’t bother some people in the least, while it sets others on edge and invokes paranoia. Internet users even experience “privacy fatigue,” letting down their guards and finally surrendering to what seemingly can’t be avoided. Another variation of privacy fatigue – where customers stop giving information all together – could have a major effect your business, impacting sales, leads, and marketing databases.

But there are people and organizations like the Electronic Frontier Foundation that stand on guard for consumers’ rights. The Foundation recently helped form an agreement with Amazon, Apple, Google, Hewlett-Packard, Microsoft and Research In Motion to be more upfront about their privacy policies. EFF director of media relations Rebecca Jeschke says that we shouldn’t have to sacrifice our technological developments for the sake of privacy, and that finding an equitable solution to the problem of accessibility and privacy should be within our grasp.

What do you think about single sign-on? Is it a modern-day convenience, or a threat to our privacy? Let us know in the comments.

[Image Credits: Andy Powell, echo4ngel, brionv, Michael Coghlan, JBrazito]