VIZIO Inc., a manufacturer of smart TVs, has agreed to pay $2.2 million to settle a regulatory complaint that it continuously tracked its consumers on their Internet-connected smart TVs without their knowledge or consent.
According to the Federal Trade Commission (FTC), VIZIO collected viewing habits from 11 million devices, starting in February 2014 via both new and previously sold TVs that didn’t originally ship with automated content recognition (ACR) software installed. The software periodically added IP addresses to the collected data and made it possible for more detailed personal information – including age, sex, income, marital status, household size, education level, home ownership, and home values – to be connected.
The FTC and the Office of the New Jersey Attorney General alleged that VIZIO continuously tracked what consumers watched on their Internet-connected smart TVs through proprietary software the company turned on by default. According to the complaint, VIZIO provided IP addresses and viewing data from individual TVs to third parties for audience measurement purposes and to analyze advertising effectiveness. This information was also combined with demographic information associated with an individual or household, according to regulators, and then used by third parties to target advertising to particular users on their digital devices. The agencies said VIZIO failed to inform consumers about the collection and sale of their viewing data.
In an e-mailed statement, VIZIO officials wrote: “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. 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.”