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Phone Tracking And The Law: Clear Sailing

February 21st, 2013

Now, this is not what either Euclid or Nordstrom are doing. That’s fine. Except that Euclid is collecting and storing the raw MAC address and traffic data. What can it do with it? The Nordstrom privacy policy doesn’t explicitly say. How does Euclid protect the data? How does the vendor store it? How and when does it purge that data? Can Euclid aggregate it and sell the same data to third parties? (As the initial story noted, Euclid says its policies do not permit such sales. But policies can be changed, and there is nothing in the law that would restrict the vendor from doing so.) When I walk past a Euclid sensor, say a Starbucks (NASDAQ:SBUX) in Denver, can that Starbucks know I was at a Nordstrom in Dallas a week earlier? Can the vendor know I was at the shoe department? It’s not so simple to say, “we don’t share this information” or “it’s not personal information.”

Is it profitable?
Footfall data is supposedly useful to retailers, because they can use this anonymized and aggregated data to determine things like store locations, product placements, and where and when customers go. So footfall data is clearly profitable for Euclid, and it may ultimately be profitable for Nordstrom or other retailers.

Is it Wise?
The final question is whether this is a good idea. Nordstrom made good strides by doing two things. Apparently, the retailer placed notices outside its stores, offering some information about the policy, and provided the quoted privacy policy with more information. Euclid’s Web site provides a way for users to opt out of the data collection if they provide their MAC address to Euclid and type in a Captcha (those annoying letters and numbers to prevent fraud). It’s not very difficult to do, but it is a pain.

At the end of the day, anytime a retailer is collecting, storing, using, selling, transferring or analyzing data about a customer, that retailer needs to put itself in the shoes of its customers (in Nordstrom’s case, very nice shoes) and ask, “what would I want to know about this?” As a retailer, you want trust, which comes from openness, honestly and, potentially, an “opt in” rather than an “opt out.” And ask hard questions of the vendors, too. Find out how they will use the information collected, whether they will sell it and secure it, and how they will delete it. And put that in your privacy statement, too. Another question to ask is, “if my customers knew I was doing this, would they be upset?” If the answer to that question is “yes,” then maybe you should rethink the policy. If the answer is “no,” then hey, just tell them.

If you disagree with me, I’ll see you in court, buddy. If you agree with me, however, I would love to hear from you.


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6 Comments | Read Phone Tracking And The Law: Clear Sailing

  1. David Sheidlower Says:

    Another great article, Mark. But I think the idea that it is not difficult to opt out of being tracked by going to a web site and typing in your MAC address is a bit of a stretch.

    I’m not sure that most users can just grab their MAC addresses off their devices. Consider how much work the credit card industry has done in the past few years to get people to notice the three digits on the back of their cards (CSV#). Teaching people to learn what a new identifier is, how to find it, and what it is used for may not be as simple as you think.

  2. Mark Rasch Says:

    David

    I tried to opt out FROM MY iPhone. The problem was switching back and forth between the website (and the CAPTCHA) and the settings to get the MAC address. Also, there’s a difference between a Nordstrom CUSTOMER opting out, and a passer by who has no idea that the data is being captured at all. How about a giant sign, “warning — big brother is watching! To opt out, do the following…?”

  3. A Reader Says:

    Mark,

    Imagine that your cell phone is repeatedly playing “I’m Mark Rasch. I’m Mark Rasch.” out of its speaker, or has a projector shining “Mark Rasch” on the ceiling and floors wherever you walked. There’s no difference between this and the WiFi broadcast other than plain old eyes and ears can’t detect it. But it’s equally there.

    You’re the one who purchased and is voluntarily carrying the device that is continually spraying “I’m 12:34:56:78:90:AB” across the 2.4GHz band. You may have the device for your own convenience. It’s entirely your choice to have the device and have the WiFi radio turned on.

    If you want to “opt out”, turn off your WiFi. And your Bluetooth. And your cellphone. And remove any RFID responding devices you have from your person, including your credit and transit and door entry cards, any RFID tags sewn into your garments, and perhaps even your car keys. And if you’re going that far, you might want to wear “CV dazzle” makeup to hide from all the cameras watching virtually every public space you enter.

    Surveillance is now ubiquitous in the public square. Does it make sense to try to ignore it?

  4. Mark Rasch Says:

    I agree that surveillance is now ubiquitous in the public square. It doesn’t make sense to ignore it. It does make sense to try to balance that with rights to privacy. I transmit my MAC address in order to obtain a signal and to log on to a service. In doing so, I do not expect to create a permanant record, available to everyone at all times of my location and movements. The logic of “you are broadcasting it so it can’t be private” can apply to (and has applied to) location data as well as the contents of cordless phone conversations. IMHO, you CAN have an expectation of privacy in public spaces — its a matter of defining its parameters.

  5. Evan Schuman Says:

    And as bad as it is today, get ready for it to get a LOT worse. Here’s a wonderful piece over at TheStreet.com about Google Glass: http://www.thestreet.com/story/11850432/1/watch-out-for-google-glasses.html

  6. Marty Ramos Says:

    Doesn’t V/MC already market credit card data such that one retailer can see visits to various other retailers…

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