Apple intervenes in Radio Shack sale in effort to protect customer data

Posted:
in General Discussion edited May 2015
Bidding for the RadioShack brand and customer data has ended, but not before Apple weighed in on the proceedings, saying that information collected during the sale of its own products should be left out of the deal.


A shuttered RadioShack store, via Ted Eytan.


The hedge fund Standard General was the top bidder with $26.2 million for RadioShack's brand name and customer data. The same firm bought out Radio Shack's 1,700 store leases in March, as noted by Bloomberg.

But as the bidding process was underway in a Delaware bankruptcy court, Apple joined the proceedings with a filing of its own. Specifically, the iPhone maker argued that its agreements with RadioShack prevent customer data obtained from those buying Apple products from being resold.

In order to gain an Apple reseller agreement, RadioShack allegedly waived any rights to the data of customers who bought Apple products, as detailed by Law360.

"In order to protect its customers' personal information, Apple oversees the collection and use of customer information collected by its retail partners, including RadioShack," Apple's filing with the court reads. "The reseller agreement between Apple and RadioShack protects information collected by RadioShack regarding purchasers of Apple products and prohibits the proposed sale of such information."

Also joining was AT&T, who said that RadioShack "seemingly intends" to sell information obtained during the sale of AT&T devices.

The judge overseeing the case must still approve Standard General's bid for RadioShack, as well as the exchange of accompanying customer data, including some 67 million physical addresses and 8.5 million email addresses. A hearing has been set for May 20.

U.S. Bankruptcy Judge Brendan L. Shannon did say last month that he would not approve the sale of any customer data he finds to be impermissible.

The demise of RadioShack brings to an end a store that once catered to technology enthusiasts and hobbyists with hard-to-find gadgets, components and accessories. But as the retail space changed, and enthusiasts increasingly went online to buy products at inexpensive prices, RadioShack attempted to adapt and become primarily a smartphone reseller.

That plan failed, however, leaving RadioShack with two straight years of losses and headed to bankruptcy court. Trading of the Texas-based company's stock was suspended on the New York Stock Exchange in February.
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Comments

  • Reply 1 of 75
    suddenly newtonsuddenly newton Posts: 13,794member
    Now that's interesting. Radio Shack waived the rights to Apple customers' data...I am not familiar with those kinds of agreements. Is this uncommon?
  • Reply 2 of 75
    SpamSandwichSpamSandwich Posts: 33,408member
    And that, my friends, is why it's so important to use Apple Pay or cash only at retail establishments.
  • Reply 3 of 75
    wigbywigby Posts: 692member

    It's ironic that the most annoying part of any Radio Shack transaction (giving them your credit card, phone number and zip code when you buy a $3 battery at their store) is now the most valuable part of their entire bankrupt retail chain.

  • Reply 4 of 75
    maestro64maestro64 Posts: 5,005member
    Now that's interesting. Radio Shack waived the rights to Apple customers' data...I am not familiar with those kinds of agreements. Is this uncommon?

    yes it very uncommon that a company can bar another company from data they collect on their customers. But Apple has the power to negotiate these kinds of deals. Generally speaking once you sell your product in to Distribution channel and one could argue that Radio Shack along with Best Buy and such are distributors the company putting their products in those channels give up all rights to set price and control over who the customers are.

    This shows you how committed apple is to protection peoples information. Google would probably do the same thing, but for different reasons, mainly they do not want others making money off their informations it about profits for Google and other companies.

    On a different note, my local Radio Shack happens to be a franchise store and the owners said they all did very well and they are hoping to stay in business and they are looking to buy products directly if all possible so they can stay in business.
  • Reply 5 of 75
    gatorguygatorguy Posts: 23,176member
    Now that's interesting. Radio Shack waived the rights to Apple customers' data...I am not familiar with those kinds of agreements. Is this uncommon?
    If the original agreement stipulated that identifiable customer information could not be sold to a 3rd party I'd guess it's standard boilerplate language to say the same terms would apply in the event of a change in ownership. ATT apparently has the same in their re-sellers contract too according to the article.
  • Reply 6 of 75
    gatorguygatorguy Posts: 23,176member
    sog35 wrote: »
    Exactly.

    Just waiting for the Google trolls here to dispute that excellent point.
    Why would Google be part of the conversation in the first place? Odd that it's even brought up in an Apple specific thread if you and others don't want to encourage discussion of them. It's almost as tho someone was fishing (trolling) for off-topic and probably inflammatory comments...

    Nah, no one would do that.
  • Reply 7 of 75
    jameskatt2jameskatt2 Posts: 720member
    Quote:

    Originally Posted by Suddenly Newton View Post



    Now that's interesting. Radio Shack waived the rights to Apple customers' data...I am not familiar with those kinds of agreements. Is this uncommon?



    This is uncommon.

     

    But Apple's products are so compelling that Radio Shack had to agree to Apple's terms.

     

    Other manufacturers don't care about their customers as much since after the sale, the customer makes no profit for them, only losses.

  • Reply 8 of 75
    MacProMacPro Posts: 19,383member
    sog35 wrote: »
    Exactly.

    Just waiting for the Google trolls here to dispute that excellent point.

    He didn't but he usually ducks anything so clearly altruistic by Apple, rather spending hours on the grayer areas more open to the twisting of facts and interpretations.
  • Reply 9 of 75
    MacProMacPro Posts: 19,383member
    wigby wrote: »
    It's ironic that the most annoying part of any Radio Shack transaction (giving them your credit card, phone number and zip code when you buy a $3 battery at their store) is now the most valuable part of their entire bankrupt retail chain.

    Yes, and probably always was a major income generator for them, a model picked up and taken to the limits by Google of course.

    EDIT: Not off topic nor trolling: Highlighting a sales and marketing policy under discussion and obviously mentioning the king of that policy, that Apple is clearly trying to prevent.
  • Reply 10 of 75
    gatorguygatorguy Posts: 23,176member
    jameskatt2 wrote: »

    This is uncommon.

    But Apple's products are so compelling that Radio Shack had to agree to Apple's terms.

    Other manufacturers don't care about their customers as much since after the sale, the customer makes no profit for them, only losses.
    Since Radio Shacks own privacy policy stated that identifiable customer information would not be sold it might be deemed illegal to do so in the event of a change in ownership anyway, making the issue moot. I realize that companies seem to commonly add a disclaimer in their privacy policies (even Apple's) that in the event of a change in ownership they relinquish control of it and have no further responsibility or obligation to delete it I'll be somewhat surprised if courts agree if the issue is pushed.

    There's actually a similar case from a few years back where the FTC stepped in to prevent the sale of identifiable information when ToySmart went belly-up. That's not the only case either There was intervention in the bankruptcy asset sales of customer data belonging to Borders too. I'll guess the same will happen here even if the bankruptcy judge lets it pass., which I personally don't think he will.

    EDIT: Here's a legal paper on it
    http://blogs.law.nyu.edu/privacyresearchgroup/2015/03/radioshacks-bankruptcy-and-auctioning-off-customer-data-a-violation-of-privacy-policy/
  • Reply 11 of 75
    MacProMacPro Posts: 19,383member
    Posted to no one in particular...

    "RadioShack will press on with its plan to sell its customer data, despite opposition from a number of U.S. states. The company has asked a bankruptcy court for approval for a second auction of its assets, which includes the consumer data."

    So hardly 'moot'. No need to try to diminish Apple's excellent attitude.
  • Reply 12 of 75
    ericthehalfbeeericthehalfbee Posts: 4,284member
    gatorguy wrote: »
    Why would Google be part of the conversation in the first place? Odd that it's even brought up in an Apple specific thread if you and others don't want to encourage discussion of them. It's almost as tho someone was fishing (trolling) for off-topic and probably inflammatory comments...

    Nah, no one would do that.

    Why would Google come up? Did you seriously ask that question?

    When people are talking about privacy issues then of course Google would come up. They have arguably the biggest treasure trove of data on people of any company out there.
  • Reply 13 of 75
    MacProMacPro Posts: 19,383member
    sog35 wrote: »
    and so he appears.......

    always ready to wave the Google flag.

    That wouldn't even be so bad ... it's the perpetual attempt to lower every Apple flag that is oh so annoying on this, an Apple blog. How long did you spend on an Android site today lowering their flag at every chance? None I bet! Me neither.
  • Reply 14 of 75
    MacProMacPro Posts: 19,383member
    Why would Google come up? Did you seriously ask that question?

    When people are talking about privacy issues then of course Google would come up. They have arguably the biggest treasure trove of data on people of any company out there.

    Come on ... that was an intelligent comment ... trying to waste your time? ;)
  • Reply 15 of 75
    chadbagchadbag Posts: 1,473member

    They should have kept up their battery a month club / battery card ;)

     

    People would have gone in to the stores...

  • Reply 16 of 75
    gatorguygatorguy Posts: 23,176member
    Why would Google come up? Did you seriously ask that question?

    When people are talking about privacy issues then of course Google would come up..
    Yup I seriously asked that.

    If those few angry Apple fans that can't tolerate any mention of Google or Android or Samsung or Microsoft "on a pro-Apple site" are sincere then why try to bait folks that might not share their views with off-topic mentions and name-calling? Sounds more like they're inviting exactly the kinds of posters and comments they say they hate seeing here. :no:
  • Reply 17 of 75
    gatorguygatorguy Posts: 23,176member
    sog35 wrote: »
    its called being pro-active.

    I did a pre-emptive strike on the Google Army that resides in an Apple forum.
    On other sites it might be termed trolling...
    on other sites.
  • Reply 18 of 75
    gatorguygatorguy Posts: 23,176member
    sog35 wrote: »
    No its called anti-trolling.

    Why would you expect Apple fans to feel 'trolled' when someone brings up the sins of Google?  Only a Google fan would feel 'trolled'.

    If this was an Android site then yes it would be trolling.  when in Rome.
    Carry on then. I'm sure you'll soon get the responses you're hoping for.
  • Reply 19 of 75
    blazarblazar Posts: 270member
    Radio shack end of an era...

    Those little gadgets, resistors, transistors, and circuit boards fascinated me and led to projects when I was a kid. The iphone generation is left with no actual knowledge about how anything works. There is no local outlet or expertise to mentor little kids into tech careers. 99% of everything taught in public or private schools didn't cover what you would learn with a decent electronics kit from radio shack.

    Internet forums, youtube, and electronics stores online are also a great option but they are not visible unless you look for them. Visibility of tech learning opportunities is important and the lack of accessibility will make us no different from third world countries.

    Apple should have bought out the shack and run an educational tech enterprise using the existing real estate. Even if it broke even, jobs and opportunities would be created. Where was bill gates billions? Warren buffets billions? Curing malaria I suppose. This radio shack situation is a missed opportunity.

    A "store" dedicated to designing electronics hardware, software coding, etc. would stimulate the local economy and provide for the hope of reasonable paying blue collar and white collar jobs of the future. The "poor" are the ones who will be most adversely affected by this. Old school Radio shack is what kids in urban ghettos needed.

    I took out the circuit boards in my home furnace this weekend after it burned out. I diagbosed the problem snd ordered the new part. The expertise came from playing with radio shack kits when I was a kid. Knowledge is power. Knowledge is money in your pocket.
  • Reply 20 of 75
    MacProMacPro Posts: 19,383member
    To no one in particular ... There is no problem mentioning Google or even ... Microsoft for me at least. It is those posters who take every opportunity to undermine anything pro Apple (it is a form of just say no) that are annoying (I am trying hard to keep this in the plural). An article that is clearly demonstrating Apple's continued protection of their customers isn't greeted with appreciation and support by a Google troll, rather it is answered with a few posts attempting to downplay, nullify or refute this fact somehow. Presumably in attempt to mess with new readers' minds ... (I can't imagine there is any other purpose). This is the modus operandi of all such posts.
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