Smartphones are tracking devices that “know” more about their owners than any other product on the market, notes CNN. Wireless providers are taking advantage of their gold mine.
All four national carriers use aggregated customer information to help third parties target ads, reports CNN. AT&T, Sprint and T-Mobile insist that subscriber data is never actually handed over to third-party vendors; nevertheless, they all make money on it.
In mid-October, Verizon Wireless changed its privacy policy to allow the company to record customers’ location data and Web browsing history, combine it with other personal information like age and gender, aggregate it with millions of other customers’ data, and sell it on an anonymous basis. Verizon was the first mobile provider to publicly confirm that it is actually selling information gleaned from its customers directly to businesses, but it’s not the only one.
- AT&T’s AdWorks program promotes AT&T’s customer base to advertisers. AT&T touts its ability to “reach customized audience segments based on anonymous and aggregate demographics.” It then shows customers carefully tailored coupons, in-app ads and Web ads.
- Sprint, like Verizon, tracks the kinds of websites a customer visits on their mobile devices as well as what applications they use, according to spokesman Jason Gertzen. Their privacy policy states, “if you use a 3rd party app, it may directly collect your personal information or require Sprint to disclose your personal information, including location information (where applicable), to the app provider or some other 3rd party.”
- T-Mobile declined to answer CNN’s questions about what kind of information it shares or sells, instead pointing to T-Mobile’s privacy policy. The policy’s open-ended terms seem to suggest that the company does not divulge customer information, but a T-Mobile spokeswoman acknowledged that the company “collects information about the websites that customers visit and their location” and that it “may use that information in an anonymous, aggregate form to improve our services.”
Google and Facebook are scrambling to sign local businesses to their new services like Facebook Places, Google Wallet and Google Places. But wireless carriers are well positioned to collect and use that data as well.
A BIA/Kelsey study this March predicts that U.S. local online ad revenues will reach $42.5 billion annually in 2015.
According to Pyramid Research, location-based revenue in the US is expected to climb from $2.8 billion in 2010 to $10.3 billion in 2015.
Foursquare is probably the best-known dedicated location-based service with around 10 million users, and handles about 3 million user check-ins daily.
But Facebook Places could become a geolocation app of choice, says PBT Consulting, simply due to the reach of the network compared to others. A new report from Juniper Research says the total redemption value of mobile coupons will exceed $43 billion globally by 2016 as coupons are increasingly delivered by mobile apps.
