American company Vizio has decided to settle charges that it installed software on its smart TVs that collected viewing data of some 11 million users without their knowledge or consent.
To that end, the company will pay $2.2 million to the Federal Trade Commission and the Office of the New Jersey Attorney General.
Vizio smart TVs collected users’ viewing data
According to the complaint lodged by the agencies, Vizio’s smart TVs captured “information about video displayed on the smart TV, including video from consumer cable, broadband, set-top box, DVD, over-the-air broadcasts, and streaming devices” since February 2014.
The capturing was effected through automated content recognition software that was either originally installed on newer or later pushed to older TVs through a firmware update.
“Vizio then turned that mountain of data into cash by selling consumers’ viewing histories to advertisers and others,” FTC’s Lesley Fair explained.
“And let’s be clear: We’re not talking about summary information about national viewing trends. According to the complaint, Vizio got personal. The company provided consumers’ IP addresses to data aggregators, who then matched the address with an individual consumer or household. Vizio’s contracts with third parties prohibited the re-identification of consumers and households by name, but allowed a host of other personal details – for example, sex, age, income, marital status, household size, education, and home ownership. And Vizio permitted these companies to track and target its consumers across devices.”
Vizio hid this tracking functionality behing the benignly named “Smart Interactivity” feature. The feature supposedly enables program offers and suggestions, but does not mention that it also collects consumers’ viewing data.
From now on, Vizio will have to explicitly and prominently disclose the data collection practice, as well as obtain affirmative consent from the users for its data collection and sharing practices. The court order also prohibits misrepresentations about the privacy, security, or confidentiality of consumer information Vizio collects.
If they fail to do all of this, they can be hit with even heavier penalties from the FTC in the future.
The court order also requires the company to delete data collected before March 1, 2016, and to implement a comprehensive data privacy program and biennial assessments of that program.
“The ACR program never paired viewing data with personally identifiable information such as name or contact information, and the Commission did not allege or contend otherwise,” Vizio commented the decision. “Instead, as the Complaint notes, the practices challenged by the government related only to the use of viewing data in the ‘aggregate’ to create summary reports measuring viewing audiences or behaviors.”
Personally, I feel the amount Vizio has to pay is paltry when compared to how much they have likely earned by sharing this data with data aggregators and marketers.
I seriously doubt they would have engaged in this practice is the payoff was a mere $2.2 million. Generally, the punitive measures put in place to protect consumers from such privacy-busting practices are not enough to deter unscrupulous companies.
Consumers who bought a Vizio smart TV in the last few years are advised to think about whether they still want to share their viewing data with the company, and to disable data collection (go to Menu > Settings > Smart Interactivity) if they decide they don’t want to.