Digital Assets – Part I
Most people are familiar with their physical net worth. It is how much something physical (a house, car, savings account, etc.) is worth minus how much one may owe on it. But what about digital assets?
We define an “Intrinsic Digital Asset: as anything digital that you own or have a right to use that also may have a value to others. This could include movies you “own” after purchasing them online from your internet or cable provider, or music you bought from the Apple store, or digital books for your kindle reader from Amazon. These are all digital assets that exist only on your computer, your DVR, or your phone, but you paid money for them and you own them, or at least own the right to use them. But intrinsic digital assets don’t account for the other digital things you may own. What is that video of your child’s first step worth to you? What about those digital pictures of your wedding, or your child’s birth, wedding, or graduation? Their value may be emotional, not intrinsic. What are they worth to you? What would you pay to have them back if you lost them?
Your personal information (SSN, birth date, Driver’s License number, User name and Password for your bank accounts, etc.) is absolutely your personal digital property, and they are assets that have much more value than you realize. The acquisition and unauthorized use of your personal information is called “Identity Theft.”
The Federal Trade Commission lists identity theft as the number one complaint of American consumers and calculates that $1.6 Billion dollars was lost to fraud last year. (FTC, 2014) The U.S. Department of Justice reports that “Approximately 16.6 million persons or 7% of all U.S. residents age 16 or older, were victims of one or more incidents of identity theft on 2012.” (DOJ, 2013)
You HAVE digital assets, but based on the response we get to the question above, many don’t think of these assets as…well…assets.
Now that you understand that you already have them, and what they are, the next part of this series will discuss how to calculate what your Digital assets are worth and why you should care to know that.