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February 21, 2014

Stores can see where you go by tracking your phone

WASHINGTON — Should shoppers turn off their smartphones when they hit the mall? Or does having them on lead to better sales or shorter lines at the cash register?

Retailers are using mobile-based technology to track shoppers' movements at some malls and stores. The companies collecting the information say it's anonymous, can't be traced to a specific person and no one should worry about invasion of privacy. But consumer advocates aren't convinced. It's spying, they say, and shoppers should be informed their phones are being observed and then be able to choose whether to allow it.

The Federal Trade Commission held a workshop Wednesday on the issue, part of a series of privacy seminars looking at emerging technologies and the impact on consumers. FTC attorney Amanda Koulousias says the commission wants to better understand how companies are using phone-location technology, how robust privacy controls are and whether shoppers are notified in advance.

Here's how the technology works:

—Your smartphone has a unique identifier code — a MAC address — for Wi-Fi and Bluetooth. It's a 12-character string of letters and numbers. Think of it like a Social Security or vehicle identification number, but this address is not linked to personal information, like your name, email address or phone number. The numbers and letters link only to a specific phone.

—When your smartphone is turned on, it sends out signals with that MAC address (for media access control) as it searches for Wi-Fi or Bluetooth. Those signals can also be captured by sensors in stores that could tell a department store how often shoppers visit, how long they stay, whether they spend more time in the shoe department, children's clothing section or sporting goods, or whether they stop for the window display, take a pass and decide to move on.

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