Will consumers submit to in-home spying in return for personalization?

Sep 04, 2015

As marketers, the more we know about consumers, the better we can personalize offers and make them more relevant. But there can be negative consequences.

According to David Lazarus of the Los Angeles Times, if adopted, California bill AB 1116 would require that manufacturers of smart TVs notify consumers that they are monitoring their conversations and may potentially transmit them elsewhere.

State Assemblyman Mike Gatto was appalled in reading a Samsung smart TV manual that mentioned how conversations near the television could be monitored, recorded, and even shared. He found the prospect reminiscent of "1984" in that even bedroom conversations could be monitored and shared with unknown parties.

Although the Samsung manual has since been modified, the California bill would require that TV manufacturers and related third parties be forbidden from using or selling stored conversations for advertising purposes and allows manufacturers to reject law enforcement efforts to monitor conversations using the features.

Samsung responded by saying that these features can be turned off by the consumer and that "protecting consumers’ privacy is one of our top priorities." A prior AP article indicated that a corrected Samsung manual indicates the company’s smart TVs do not record or store conversations but only record voice commands if a user clicks a button and talks into a remote or microphone.

Samsung smart tv

Source. samsung.com

Mr. Lazarus says that any smart home appliance is potentially a window into your private life. The convenience factor of your refrigerator texting you when you are out of milk is cool, but at what price? In the AP story, Jim Dempsey, director of U Cal Berkley’s Center for Law and Technology, says information collected could also be used to make psychological assessments of customers for insurance or customer relations purposes.

Consumer advocate Clark Howard, back in February, noted that LG smart TVs have spied on consumers since 2013. They added a firmware update allowing consumers to turn off the feature, but it’s unclear if it really gets turned off. In a February piece in Forbes, Dave Lewis says it is unclear which third parties get information that Samsung collects but guesses it will be advertisers and marketers. He says Samsung Smart TVs can recognize faces, meaning they can listen and record conversations, and associate the conversations with individuals.

Perhaps the scariest part is that smart devices are getting smarter at an exponential rate, while humans aren’t. Perhaps "bad guys" will figure out a way to intercept information that smart devices, apps and software collect and share to use against us.

Will government intervention be needed to stop tech manufacturers from building devices that monitor our activities with the potential of disseminating our personal proclivities to unknown parties? Will the comfort consumers have sharing personal data browsing online eventually extend to IoT-driven devices?

"Consumers can turn this "feature" off only if they know it’s there. I always use the "grandma rule" when considering things like this; what would your grandma think of this? Grandma, let’s face it, would throw the thing out the window."
"This situation, especially with Samsung TVs, has been known for a long time, yet it seems that even here among the learned and insightful BrainTrust, the potential for info gathering was not known."

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17 Comments on "Will consumers submit to in-home spying in return for personalization?"

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Steve Montgomery

While I hate to invite any more government regulation I would support not allowing this type of data collection without the individual’s knowledge and consent. All the opt in check boxes should be blank so that a person has to indicate that s/he wants to opt in rather than having to uncheck them to ensure it doesn’t happen automatically.

It may be generational but I still like the idea of privacy even though I realize it’s more perception on my part than a reality. I will say the article convinced me to hold on to that old plasma 42-inch that still has a great picture a little while longer.

Cathy Hotka

Consumers can turn this “feature” off only if they know it’s there.

I always use the “grandma rule” when considering things like this; what would your grandma think of this? Grandma, let’s face it, would throw the thing out the window. It’s outrageous. I love my smart TV, but I’m going hunting for the manual right now.

Gene Detroyer

Please forgive my naivety, but this is outrageous. Of course permission is needed. And beyond that not only permission, but an explicit description of the possible consequences of “opt in.”

And also forgive my paranoia, but I am sure there are sectors of government that are absolutely drooling at the opportunity to tap into this information.

Ed Rosenbaum

I can’t believe I am reading this. This is taking interference in privacy to a level we should not allow. Of course we can turn it off. IF we know it is there. I have a Samsung TV. I hope I can find the turn-off but doubt it. This is appalling.

Lee Kent

With technology invading every inch of our lives these days, consumers are wising up to ask the questions that matter most to them. What data are you collecting and what are you doing with it?

The consumer is then demanding that they not be automatically opted in. If the manufacturer doesn’t comply, guess what? The consumer does not buy the product. We, the consumer, rule, these days!

As for government? We really don’t need to put this in the hands of the government. The people will dictate what they will tolerate and not. If the people’s rights are violated, yes they should be able to take legal action and have the full support of the law in their favor.

When a manufacturer applies for a patent? Yes, the patent office should be responsible for monitoring invasion of privacy and requiring adjustment before the patent is approved.

I really don’t think we are ready for Big Brother. That, to me, is the highest level of privacy invasion.

And that is my 2 cents!

Paula Rosenblum

It’s really simple. As we learn about this nonsense we will turn off these features and more. I don’t think we need the government involved (and who is going to stop THEM by the way?). The market will solve this nicely.

Ken Lonyai

This situation, especially with Samsung TVs, has been known for a long time, yet it seems that even here among the learned and insightful BrainTrust, the potential for info gathering was not known. Imagine how few “average consumers” have an inkling that they might be sharing data unknowingly. And yes, when the Samsung situation became known, many TV owners said that they had no idea how to change the default setting to one of privacy.

No one likes more regulation, but corporations (which literally does include every big tech name you can think of) have had no regard for consumer privacy and have brought this scenario to bear. Don’t expect them to roll over though, especially if a federal bill is introduced, because they want to know everything about you.

Camille P. Schuster, PhD.

If consumers are willing to allow data to be collected in return for personalization or better service, then collection of this data needs to be opt in with consumers having knowledge of what data is being collected and having given explicit permission for it to be collected. If consumers are not comfortable with this practice, they can opt out. Then we will know consumers’ comfort level.

jack crawford
jack crawford
2 years 1 month ago

If given any amount of real thought, this is beyond scary. Marketers having control of information like this is truly dangerous. Marketing’s end goal, like many others, is to make money. When push comes to shove, where does it all end up?

Li McClelland
Li McClelland
2 years 1 month ago

Heh. This stuff makes retailers’ notion of “smartish” carts tracking your moves and eyeballs within their stores seem pretty tame in comparison, doesn’t it? Seriously, I think people across the spectrum of society are getting fed up with the spying and unwanted intrusion into our private lives by both government and industry, but we genuinely don’t know what to do about it or how to fight it.

Ryan Mathews

The answer to the second question is “Yes” otherwise the Internet of Things … well … will look more like the Partialnet of SomeThings. No sharing, no benefit.

The first question is more interesting considering it is the government that already monitors devices in our homes. Which will consumers trust more, a government that monitors their phone calls or a manufacturer trying to sell them packaged goods?

Tough question.

Vahe Katros

This is where retailers come in—don’t trust the manufacturer, trust the retailer who will not sell you stuff that spies on you; the retailer has the experts that will insure your privacy. Retailers can win by addressing our generation’s EDLP opportunity: Electronic Device Listening Paranoia. It’s the next big thing. Someone get on the phone with Best Buy—we need to talk!

Craig Sundstrom

Much like gun control, I suspect our monitoring practices are ALREADY illegal. It’s illegal, for instance, to record a conversation without at least one of the party’s consent—so the biggest danger is business lobbying for changes in existing laws (adopting standards of “implied consent” for example). But as many here noted, it’s a battle between one group of naive people, trusting the power of the consumer, versus another, trusting the benevolence—and efficiency—of government.

Doug Garnett

Yes. I’m appalled at Samsung’s “Well, they can turn that feature off” since most people can barely turn their TV on and get the color reasonably accurate. In a court, they’d be laughed out for that statement.

We MUST respect consumer privacy or everyone who participates in this forum will suffer.

This is one of those issues of the “common”… Samsung isn’t sufficiently punished by the market for violating the common consumer trust of electronic devices. In that case, unless we all make the choice to support privacy, we won’t leave any option EXCEPT for the government to step in. And that isn’t always very helpful.

Ed Dunn
2 years 1 month ago

This is not as clear cut as eavesdropping refers to telephone communication, nor Internet traffic. And the DMCA does not hold the ISP/service provider liable for information uploaded. So in a way, unlike OnStar which use FCC waves, this eavesdropping smart TV could possibly be a legal loophole.

I brought this up with Amazon Echo giving a scenario where a couple in an apartment start arguing and Amazon Echo interrupts and recommends relationship books and offer 1-click shipping and same-day delivery.

Kenneth Leung

I am reading the document and trying to figure out beyond the sensational headline why Samsung would put something like that in the manual. If you are doing voice recognition over the cloud, you are effectively “monitoring, recording and transmitting the conversation.” Hence the issue, in order to do some of the advanced features that involves speech and gestures, by default the system has to continuously monitor its environment.

I think the answer is a combination of regulations on data collection and sharing and education that there has to be a trade off between features and privacy. My cell phone and social media profile shows more about where I am and where I have been and what I have done than ever before, I accept it knowing it isn’t private. For some people, that’s okay, for some it is not.

Matt Talbot

Ultimately the consumer (and possibly governmental) driver of an intervention will be a derivative of the perceived value of personalization. If consumers find there to be a great amount of value in that service, and government intervention would likely be labeled by consumers and the media as “a government overreach in the free market.”

If consumers do not find value in the personalization they will demand, and the government will follow suit, in requiring adequate disclosure when it comes to collecting and utilizing personal data.

In the end, whatever happens will likely be driven by the market’s assessment of the value it has traded their personal data for.

"Consumers can turn this "feature" off only if they know it’s there. I always use the "grandma rule" when considering things like this; what would your grandma think of this? Grandma, let’s face it, would throw the thing out the window."
"This situation, especially with Samsung TVs, has been known for a long time, yet it seems that even here among the learned and insightful BrainTrust, the potential for info gathering was not known."

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