Verizon Halts Sale of Some Phone-Location Data

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In a letter [PDF] to the lawmaker, the American telco giant said it has "conducted a comprehensive review" of its "location aggregator program" and as a result would kill the agreements it has with the two companies in the program, LocationSmart and Zumigo.

Major wireless carriers are allowed to sell real-time location data to third-parties, which is often used for targeted advertising from advertisers. Those types of services can include routing calls to the right facility, fraud prevention and vehicle tracking.

Sprint hinted that its privacy policy allows the phone giant to share customers' personal data, "including location information" with third-parties. But Karen Zacharia, Verizon's chief privacy officer, said in the letter that Securus "impermissibly permitted law enforcement agencies to request location information" for investigative purposes. "This will take some time in order to unwind services to consumers, such as roadside assistance and fraud prevention services". "Verizon will work with aggregators to ensure a smooth transition for these beneficial services to alternative arrangements so as to minimize the harm caused to customers and end users", said Verizon.

"Verizon did the responsible thing and promptly announced it was cutting these companies off", said Wyden in a statement Tuesday, following an investigation by his office.

Hoping to get out ahead of this scandal before the press and public realizes that abuse of location data makes the Cambridge and Facebook scandal look cute, Verizon today sent a letter to Senator Ron Wyden (pdf) stating the company would stop selling private consumer location data to third party brokers.

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"We're trying to do with right thing for our customers", he said.

Sprint said account holders must "generally be notified" if the data is to be used so they can decide whether they consent.

LocationSmart pushed back against Wyden's characterization, insisting in a statement that it "does not buy or sell location information, nor does it permit the sharing of location information about any mobile device without a user's consent". Shortly after that, T-Mobile CEO John Legere tweeted that the wireless carrier won't sell customers' location information to "shady middlemen", though he didn't elaborate about which companies he was referring to. A web portal allowed correctional officers to enter any USA phone number and obtain real-time location data on consumers.

Location data from Verizon and other carriers makes it possible to identify the whereabouts of almost any phone in the USA within seconds. It will also refrain from signing new data-sharing contracts with third parties.

Analysts say it's hard to gauge the size of the location-tracking aggregation market. Sprint said in a statement that it cut ties with LocationSmart on May 25. Wireless carriers have been selling that data for years, but it looks like US operators are now changing their practices a bit.

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