Privacy Framework for Smart TV Sets, Services Not Clear Cut
The privacy rules covering so-called “smart TV” services and devices aren’t clear, industry executives and public interest advocates said. That could be a problem if such services become popular with consumers, as TV set makers and pay-TV distributors seek to add apps, widgets, interactivity and ad targeting to their services, they said. “The same business models that collect a tremendous amount of data online, and have raised privacy concerns in congress and at the FTC, can now be found on the television set,” said Jeff Chester, executive director for the Center for Digital Democracy. “This is a major privacy issue that is about to boil over and regulators will be caught flat footed by not trying to address it,” he said.
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A variety of laws and regulations cover privacy on the TV set, industry lawyers said. The Children’s Online Privacy Protection Act (COPPA) address’s children’s privacy for all Internet services and the Cable act has provisions that address privacy for pay-TV services, they said. “If someone is an MVPD under the Cable Act, then everything they touch is subject to the protections of the act,” said Paul Glist, an attorney with Davis Wright who represents cable operators. “But if someone comes in and builds a smart TV with set-top-box-like functionality, they're not considered a cable operator and they're not considered a satellite provider,” he said.
"It really is the classic unanswered question,” said Marcelino Ford-Levine, general manager, interactive content and advanced advertising development, for Intel’s Digital Home Group, at a recent interactive TV conference in San Francisco. “We've been looking at the privacy issues and trying to understand how to pass what we see emerging as a bright line test,” he said. “You really have to educate the consumer as to what their data is going to be used for” and give them the ability to opt in, and “at any time press the delete button and say ‘I want out,'” he said. “It’s really going in that direction."
Existing safeguards are inadequate, Chester said. “If it’s connected to the Internet, then you do have COPPA but you have nothing else to the extent to which they're able to collect data about your online activity through the TV set,” he said. “That’s a gray area,” he said. But it might not be completely gray, at least for third-party devices that allow access to traditional pay-TV service. The Cable Act protections can be applied to those devices through a license and contract system between pay-TV service providers and device manufacturers that guarantee the integrity of the customer experience, including privacy, Glist said. “There is actually a customer relationship there that needs to be assured, and privacy is an element of that,” he said. “You can do it through B-to-B agreements, or generally applicable licenses,” he said. “You can do it by a rider on the decryption licenses,” he said.
The pay-TV providers’ advanced ad plans should raise privacy concerns, Chester said. “They have the majority of eyeballs and they have access to the real financial records,” he said. “They're creating a wide range of data collection practices that fly in the face of any notion of privacy.”