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Verizon fined $1.35 million for tracking customers without them even knowing

After going back and forth with the Federal Communications Commission, Verizon agreed to settle with the agency over its use of Unique Identifier Headers (UIHDs).

Better known as supercookies, these device-level identifiers allow Big Red and its advertising partners to deliver targeted ads based on customer information, such as age, gender, location, apps, websites that customers visit, and interests. Unfortunately, according to the FCC, Verizon abused these supercookies by inserting them into its customers’ mobile traffic in 2012 and not letting them know about it until October 2014. In addition, it took Big Red another five months to update its terms of service to include information regarding its targeted ads program.

Related: Verizon kicks off wireless 5G testing in the U.S.

Furthermore, Verizon also injected supercookies into enterprise, government, and mobile virtual network operator (MVNO) lines, all of which are ineligible for targeted ad programs.

According to FCC enforcement bureau chief Travis LeBlanc, this is a matter of protecting customer privacy, though he has implied there is a degree of tracking that is acceptable. “Consumers care about privacy and should have a say in how their personal information is used, especially when it comes to who knows what they’re doing online. Privacy and innovation are not incompatible,” said LeBlanc. “This agreement shows that companies can offer meaningful transparency and consumer choice while at the same time continuing to innovate.”

As part of the $1.35 million settlement, Verizon is not only required to turn the data sharing into an opt-in, rather than an opt-out, affair, but also inform customers about its targeted ads program. According to Big Red, it’s already begun working on the latter.

“Over the past year, we have made several changes to our advertising programs that have provided consumers with even more options,” said Verizon regulatory spokesperson Rich Young. “Today’s settlement with the FCC recognizes that. We will continue to give customers the information they need to decide what programs and services are right for them.”