Location-Based Analytics, Carrier IQ and Your Mobile Privacy

If you’ve been following the news recently, you’ve heard the buzz about an invasive Carrier IQ software that’s likely installed on your smartphone. Now that security experts have discovered this apparent spyware, privacy and security alarms are sounding off. The news is exposing the questionable methods used by carriers to collect mobile analytics data. A similar scenario occurred last week on Black Friday as you were shopping for great deals. It took a call from Sen. Charles Schumer (D-NY) for a mall operator to realize that using “location-based analytics” to collect information about people without their explicit consent is probably not a good thing. 

And as much as we tout the importance of analytics for collecting and analyzing pertinent data to help businesses be more competitive, tracking people’s movements via their cell phones – or by any other means – to collect that information, without giving them the opportunity to explicitly agree to it, isn’t the right thing to do, according to a number of privacy groups including the Electronic Privacy Information Center.

Here’s the story:

It seems Forest City Commercial Management launched a survey on Black Friday at the Promenade Temecula in Southern California and Short Pump Town Center in Richmond, Va., that gathered information about shoppers’ behaviors by tracking the signals from their cell phones. The problem: the management company didn’t give shoppers the chance to explicitly agree to be tracked.

Apparently, the management company thought tracking people without their consent was such a good idea, it was going to continue this practice at those malls through New Year’s Day.

Path Intelligence, the UK-based manufacturer of the technology, and Forest City say that the technology doesn’t identify shoppers’ personal data including their names or phone numbers. Rather, the technology assigns a random ID number to each phone, so the mall can track shoppers’ movements anonymously.

Enter Schumer and his concerns about people’s privacy.

Schumer, however, isn’t buying the anonymous stuff. He says he’s concerned that hackers could somehow get hold of the data and link the ID numbers to personal information.

After his phone call, the mall operator put the survey “on hold.”

I’m sure you’ve noticed that I’ve italicized the words, explicit and explicitly, several times. Here’s why: it all boils down to allowing shoppers to “opt in” to the survey or “opt out.”

“Opt in” means a person would be required to take some action to be including in the survey, or by default he would be excluded.

“Opt out,” means a person would have to take some action to be excluded from the survey, or by default he would be included.

The malls used this “opt-out” practice—sort of.

The technology the malls used to anonymously track shoppers involved the use of antennas set up around the shopping centers to anonymously track shoppers as they moved from store to store. Customers were alerted to the survey via small signs to their cell phones, and if they didn’t want to participate the only thing they could do was turn off their phones. But I’d venture to guess not many people would be willing to do that.

What this mall operator was doing is akin to companies like Amazon using cookies to track consumer behavior without a consumer’s consent.

Cookies are text files saved in your temporary Internet folder that are created to keep track of your browsing history and information. “Companies like Amazon use tracking cookies to track your browsing behavior and then make ‘personalized’ recommendations on what to buy from that company.”

Because the information Amazon and other companies collect isn’t private, they often share that information with other companies. Much like the mall shoppers who were forced to turn off their phones to opt out of the survey, the only way to stop Amazon and others from collecting information about your shopping habits is to delete the tracking cookies.

On the other hand, there are other companies like Locately, which like Path Intelligence, conducts location-based market research via mobile devices to better understand consumer behaviors, that collect that information the right way—by allowing people to explicitly opt in.

Remember, analytics is a good thing, but only if companies operate in an upfront manner. For what it’s worth—the mall company said it now plans to use an easier opt-out option for consumers.

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Photo courtesy of theage.com.au

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Author: Linda Rosencrance
Spotfire Blogger