Dive Brief:
- The four largest mobile carriers in the U.S., Verizon, AT&T, Sprint and T-Mobile, plan to end sales of users' wireless location data to third-party brokers that share the information with other companies, the Associated Press reported. AT&T, T-Mobile and Sprint's moves Tuesday followed a prior AP report on Verizon, which became the first major carrier to declare plans to end such data-sharing practices earlier this month.
- Verizon announced its plans in a June 15 letter sent to Senator Ron Wyden (D-O.R.), who has been actively looking into the phone location-tracking market, per the AP. Roughly 75 companies have been obtaining Verizon's customer data from two California-based brokers, LocationSmart and Zumigo, which Verizon worked directly with. Wyden in May detailed how one of LocationSmart's customers, Securus Technologies, has been providing some of the data to law enforcement officials without proper oversight or user consent. Securus, which was supplied the data by the reseller 3CInteractive, has been cut off by all four of the carriers.
- However, none of the carriers plan to stop selling location data altogether. Verizon's Chief Privacy Officer Karen Zacharia noted to the AP that the practice is important for "beneficial services" like fraud prevention and emergency roadside assistance. An AT&T spokesman echoed similar sentiments in an email correspondence with the AP. Neither AT&T nor Verizon commented to the AP on how they plan on continuing to sell location data directly to companies instead of working with LocationSmart and Zumigo.
Dive Insight:
Leveraging location-based data is an increasingly popular tactic marketers use to target consumers with tailored ads, messages and offers, but all four major U.S. carriers backing off some of their data sharing practices shows how privacy concerns are looming larger over the space, along with the presence of potentially bad actors. Obtaining proper user consent on data collection and transparently detailing how that data is then shared with third-party brokers have become areas of national concern in recent months amid a slew of controversies and mounting regulatory scrutiny.
Facebook's Cambridge Analytica scandal uncovered that a data firm with ties to Donald Trump's presidential campaign had abused information from an estimated 87 million users' profiles. Facebook has been hit with subsequent scrutiny over how it gives access to app developers, device makers and some businesses. The social network has enacted measures to allay concerns over data privacy, and plans to require advertisers to tell users if data brokers provided the information that led to them being targeted with an ad.
But while Facebook might be under the harshest spotlight for its missteps — it is the world's second-largest digital advertising platform — the latest news underpins how the murky handling of customer data, and the difficulty of keeping track of the data once it's sold to third parties, is an industry-wide, not company-specific, problem. Per the AP, the data-sharing business is increasingly lucrative, but not especially well-regulated, though that could change given the lack of transparency in the space.
"Verizon is learning from Facebook's mistakes by getting out in front of this issue," Dan Goldstein, the president and owner of the marketing firm Page 1 Solutions, said in emailed commentary to Mobile Marketer. "It begs the question, however, about what other private data they have been capturing and selling and also demonstrates that many other tech companies, like Google, Amazon, Apple, as well as ISP providers like AT&T and Comcast, among others, may have sold private user data without consent."
Eighty-seven percent of surveyed mobile marketing professionals have seen success with their location targeting efforts, according to a recent study by Lawless Research commissioned by Factual and reported on by Marketing Land. Sixty-five percent of marketers leverage location technology for ad targeting purposes, while 49% use it for location-based offers.
