Privacy and Data Security

The Federal Communications Commission (FCC) recently published a report analyzing consumer privacy for location-based services, which it defined as "mobile services that combine information about a user's physical location with online connectivity." The FCC sees the industry as a growing one, including not just wireless carriers but companies in a variety of sectors, such as gaming, entertainment, advertising, and more. According to the report, location-based services are expected to provide $700 billion in value to consumers and companies over the next decade. The FCC expressed privacy and security concerns with respect to these services, and suggested steps companies should take to address its concerns. These steps include providing transparent notice about location-based services to consumers. As part of this recommendation, the FCC urged companies to make statements (like privacy policies) clearer and shorter. Brevity is all the more important given the space constraints of mobile devices. This recommendation echoes similar comments from industry groups and the Federal Trade Commission. The FCC also called for meaningful consumer choice, and recognized that technologies exist or are being developed that help offer choice. These include, for example, opting in to have location information shared with other companies or giving consumers the ability to provide categories of consent (presumably at a browser or device level). Another concern expressed by the FCC is the extensive amount of consumer information that is created by location-based services, what third parties have access to this information, and how this information is protected. In that regard, the FCC urged companies to maintain adequate technical, physical, and administrative safeguards to protect personal information from the risks of unauthorized disclosure or access of location-based personal information. 

TIP: Companies considering using location-based services can use the FCC report as a helpful outline of the types of concerns government regulators will be looking at in this area. The report also gives some practical suggestions, such as having clear notices, providing sufficient security, and providing consumers with appropriate consents.