July 3, 2018

data-brokers
Data Brokers

Verizon Wireless (“Verizon”) recently announced that it would end the sale of cell phone owners’ real-time location data to companies that buy and sell access to consumer location data. Within days of Verizon’s announcement, AT&T, Sprint, and T-Mobile piggy-backed on Verizon’s move by announcing that they too plan to limit and/or end sales of location data to data brokers. These wireless carriers—the four largest in the United States—have drawn criticism for the sale of cell phone owners’ location data to data brokers, as this information can be used to identify the whereabouts of almost any cell phone in the United States within seconds.

What motivated these wireless carriers to end sales to data brokers?

In response to recent increased concern over consumer privacy and security, companies based in the United States have been self-regulating their collection of consumer personal data. As we have previously blogged, Apple recently changed its app data collection rules by restricting app developers from building databases of iPhone owners’ digital address books—even if iPhone owners consent to same.

The recent decision by these wireless carriers to end and/or limit the sale of location data to data brokers comes as no surprise to United States Senator Ron Wyden (D–OR), who has been investigating location privacy issues involving these wireless carriers. In a letter to the Federal Communications Commission (“FCC”), Senator Wyden explained that he discovered that a third-party prison technology company, which purchased location data from a data broker, used that location data for the unauthorized surveillance of government officials, without a warrant or other legal basis.

In his letter to the FCC, Senator Wyden called on the FCC to investigate wireless carriers for allegedly not obtaining the consent of consumers before sharing their location data. Of additional concern to Senator Wyden, is the fact that after wireless carriers sell location data to data brokers, the data brokers then resell that location data to third parties. Once the location data is in the hands of third parties, wireless carriers no longer have the ability to protect the location data of their customers.

The four major wireless carriers have promised to end and/or limit the sale of location data to data brokers as soon as practicable. Location data would still be used for certain purposes, however, including for fraud prevention, emergency roadside assistance, and call routing.

Direct Consent to Location Data

Importantly, the wireless carriers’ decision to end and/or limit the sale of location data to data brokers does not prevent business owners, such as app developers and other services, from obtaining location data directly from users upon consent.  Businesses, including app developers, requesting cell phone user location data should be sure to obtain consent from users and maintain records of such consent.

If you are interested in learning more about this topic or need assistance with drafting consent language, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.

The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney.  Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.   

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