FCC to reportedly fine US wireless carriers at least $200M for selling customer location d...

AppleInsider · February 28, 2020 12:31AM

The U.S. Federal Communications Commission is expected to propose hefty fines on AT&T, Verizon, Sprint and T-Mobile following an investigation into allegations that the U.S. cellphone carriers collected and sold real-time consumer location data.

FCC Chairman Ajit Pai.

Citing sources briefed on the matter, Reuters on Thursday reports the FCC plans to announce at least $200 million in proposed fines by Friday. The companies, which are in hot water for sharing customer location data, will have a chance to challenge the fines prior to finalization.

The expected announcement arrives nearly a month after FCC Chairman Ajit Pai revealed "one or more" U.S. carriers might face fines over illegal data practices. An investigation by the FCC's Enforcement Bureau found certain wireless carriers "apparently violated" federal law and could face fines for profiting from the collection and sale of user location data.

Reports in 2018 sparked furor over alleged illicit practices that saw telecoms like AT&T, Verizon, Sprint and T-Mobile sell off customer data to a wide range of buyers, including law enforcement agencies, bounty hunters, tracking services and alleged stalkers.

Following public outcry and multiple class action lawsuits, the named carriers promised to end their controversial data sharing programs, with Verizon being the first to take action in November 2018. AT&T, T-Mobile and Sprint followed suit in 2019. With a few minor exceptions, all major carriers stopped selling data to third-party aggregators last May.

Each of the four carriers attempted to distance themselves from any wrongdoing associated with the so-called location based services (LBS) programs, with some claiming their respective operation was in place to benefit customers.

cpsro · February 28, 2020 1:24AM

Only $200M? Still a profit center! Ajit's their guy!

seanismorris · February 28, 2020 1:44AM

And, they made how much selling the data?

kmarei · February 28, 2020 2:22AM

Well that’s great news.
the guilty party paid the ref (and lawyers), meanwhile the innocent victims got screwed, and got nothing for it
sounds good

Fatman · February 28, 2020 3:17AM

All of geofencing based marketing relies on location data ... the data is harvested by your weather app (which typically has location services always on) and sold. IBM should be next in the lawsuit and should be fined at least a billion IMO.

MplsP · February 28, 2020 3:23AM

This is just the big brother government of dictator-wannabes going off on a power trip.... wait- I agree with this. But the government is bad and full of idiots. Now I don't know what to think

Seanismorris is right - the fine should be at least triple what they actually made from the sale, and then some taken out of the CEO's paycheck.

chasm · February 28, 2020 4:57AM

If that $200M is collective, then this is scandalously low -- a slap on the wrist that amounts to sofa-cushion money from these big providers. I'd expect no less for the World's Most Corrupt FCC Chair and his minions. Even if it were $200M each, I don't think it would do the first thing to curb the practice, and would just be seen as a (small) dent in the profitability of such actions).

I wish the US government would grow a pair and fine companies this size -- and this would include Apple if they did something this bad -- 25 percent of their gross revenue for every year they engaged in the practice. That would put an immediate and irrevocable stop to these shenanigans, by killing their total profit outright.

All-Purpose Guru · February 28, 2020 6:36AM

They are not going to fine the companies anything like what we want them to do because the FCC doesn't work for us, it works for the big companies.

FWIW I was expecting an even smaller slap on the wrist.

Rayz2016 · February 28, 2020 7:54AM

Not a good thing to say, but that man has a very slappable face.

doozydozen · February 28, 2020 8:08AM

“ with some claiming their respective operation was in place to benefit customers.”

that’s most certainly the case. /s

hodar · February 28, 2020 11:40AM

For a fine to have any meaning, it must be a financial DIS-INCENTIVE to prevent re-occurance of the privacy violation. If a company made $500 Million off selling invasive personal information, and was fined $200 Million (on the off-chance they were caught); then the penalty is nothing more than a tax.

But, if the penalty was 2x-10x the benefit - say $1+ Billion on the first occurrence; the Corrective Action would be the immediate dismissal and black listing of all executives involved in that decision, and near financial ruin for the company. This would not only provide corrective action, it would warn other companies that fiscal ruin is their too, should they decide to operate illegally, unethically and immorally.

Corporations do not care about ethics, morals and laws - they care about profits. You need to speak to them in a language they are capable of understanding.

sdw2001 · February 28, 2020 3:09PM

It's a start, but in reality the costs just get passed on to us anyway. They sell our data, then we get fined for it with higher prices. The same applies to the thinking on corporate taxes. Corporations are never going to sit back and make less money. The best way to stop this is to stop these absurd, market-price destroying mergers. I think we're going to eventually see the breakup of big tech and telecom. It may take another 20 years, but it will happen. Keep in mind, I'm a free market guy. But illegal monopolies are illegal monopolies. Consumers have very little choice in communications providers. In my area, it's Verizon or Comcast. Cell services are down to ATT, VZW and Sprint/T-Mobile. Sure, there is great competition amongst streamers, but access to the actual infrastructure is controlled by a corporate cabal.

spice-boy · February 28, 2020 3:24PM

Fatman said:

All of geofencing based marketing relies on location data ... the data is harvested by your weather app (which typically has location services always on) and sold. IBM should be next in the lawsuit and should be fined at least a billion IMO.

you missing all the facts my friend

frankie · February 28, 2020 3:28PM

Everyone agreeing that the companies are screwing us and the fine is a slap in the face. These multi-billion $ corporations OWN our government and us and they write the laws not the politicians.

I sure hope you are supporting Bernie Sanders as the only person running who even discusses getting the money out and holding companies responsible.

habi000 · February 28, 2020 3:28PM

sdw2001 said:

It's a start, but in reality the costs just get passed on to us anyway. They sell our data, then we get fined for it with higher prices. The same applies to the thinking on corporate taxes. Corporations are never going to sit back and make less money. The best way to stop this is to stop these absurd, market-price destroying mergers. I think we're going to eventually see the breakup of big tech and telecom. It may take another 20 years, but it will happen. Keep in mind, I'm a free market guy. But illegal monopolies are illegal monopolies. Consumers have very little choice in communications providers. In my area, it's Verizon or Comcast. Cell services are down to ATT, VZW and Sprint/T-Mobile. Sure, there is great competition amongst streamers, but access to the actual infrastructure is controlled by a corporate cabal.

Markets don't work like that. You can not pass anything onto the price if your rivals dont have the need to higher costs. You can just switch carriers. Hopefully one of them didnt fuck up. Or are you referring to some kind of market cartel?

acheron2018 · February 28, 2020 3:32PM

“Illegal data practices”. Yet not one single person is going to prison.

If I break federal law, I go to prison.

This will continue until the feds grow a pair and start fining them a double digit percentage of gross profit OR seizing radio spectrum OR sending corporate officers to prison!

And no! Don’t even bother to say “I didn’t know someone authorized that”. In addition to being your legal JOB it is also your fiduciary responsibility to make sure the company you run is not selling drugs; weapons to terrorists; or engaged in ANY illegal activities that would reflect poorly on the market’s perception of the company.

sunman42 · February 28, 2020 5:47PM

Worth noting that Version alone made a profit of ~ $80B in their fiscal year 2019. This is barely the noise on the paperclip budget.

sdw2001 · March 1, 2020 4:49PM

habi000 said:

sdw2001 said:

It's a start, but in reality the costs just get passed on to us anyway. They sell our data, then we get fined for it with higher prices. The same applies to the thinking on corporate taxes. Corporations are never going to sit back and make less money. The best way to stop this is to stop these absurd, market-price destroying mergers. I think we're going to eventually see the breakup of big tech and telecom. It may take another 20 years, but it will happen. Keep in mind, I'm a free market guy. But illegal monopolies are illegal monopolies. Consumers have very little choice in communications providers. In my area, it's Verizon or Comcast. Cell services are down to ATT, VZW and Sprint/T-Mobile. Sure, there is great competition amongst streamers, but access to the actual infrastructure is controlled by a corporate cabal.

Markets don't work like that. You can not pass anything onto the price if your rivals dont have the need to higher costs. You can just switch carriers. Hopefully one of them didnt fuck up. Or are you referring to some kind of market cartel?

The point is you can’t just switch carriers because there are only a couple of options. In reality, they are basically all the same. They aren’t competing with each other at all.

FCC to reportedly fine US wireless carriers at least $200M for selling customer location d...

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