Smart TV Maker Spied on Viewing Habits, Sold Data
Vizio is to pay $2.2 million in fines after tracking viewing habits on 11 million smart TVs without their owners' knowledge or permission. They then sold the details, including personal information, to advertisers.
As part of a settlement, Vizio has now agreed to inform customers about the practice and promises to always get their express consent before tracking any viewing. It will also have to delete much of the data it has already collected.
Vizio had relied on the idea that customers retained enough control because there was a setting named "Smart Interactivity" that could be switched off. The Federal Trade Commission (FTC) says this wasn't highlighted enough and that in any cases, Vizio had misled customers by merely saying the setting "enables program offers and suggestions." (Source: ftc.gov)
TV, DVD and Netflix Viewing Tracked
Amazingly what the setting actually did was enable software which analyzed a set of pixels on the screen every second. It then cross-referenced these pixels with an apparently huge database of movies and TV shows, which sounds similar to the way some firms automatically spot content uploaded to video sharing sites without permission.
The result was that Vizio was able to tell exactly what customers were watching, regardless of whether it was from television broadcasts, DVDs or streaming services. As well as including it on new sets, Vizio updated older smart TVs to carry out the tracking.
It then sold the resulting data along with the IP addresses to advertisers. The FTC says that although Vizio barred anyone else from using the data to identify individuals by name, it didn't restrict them from matching it to other personal information such as age, income or marital status.
Online Ads Based On TV Viewing
The advertisers bought the data in three different ways. Starting in May 2014, the data was simply a way to get overall figures on how many people watched particular shows and commercials.
From May 2015, Vizio began selling the data to companies which cross-referenced the information about a particular TV set with tracking activity on computers and other devices at the same IP address. The idea was to see whether people who saw a TV commercial then went on to visit the advertiser's website, or whether people who saw an online ad for a TV show went on to watch it.
From March 2016, the data began to be used to affect the ads people saw online, which began to be targeted based on the viewing habits of people in the household. (Source: nj.gov)
Vizio will now pay a penalty of $1.5 million to the FTC and a further $2.2 million to the state of New Jersey, which brought a complaint alongside the FTC.
What's Your Opinion?
Is the fine and deletion of the data a suitable punishment? Are you surprised that viewing habits can be tracked in such a way? Is the way Vizio used the data a major problem in itself, or is the real danger in how such data might fall into less responsible hands?
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