By: Brian D. Kahn and Alexandra R. Rambis
June 7, 2016
TV and video privacy concerns began decades ago and revolved around an individual’s video rental habits. Over time, as Blockbuster and corner video rental stores went away, they were soon replaced by video streaming services, such as those provided by Netflix, Hulu, and Vudu. The latest evolution of this technology is the newest generation of Smart TVs, which are now equipped with built in “digital assistants,” similar to Apple’s Siri or Amazon’s Alexa device. These “digital assistants” can offer features such as voice, face and gesture recognition. However, in order to provide such services, these Smart TVs must be constantly listening or watching users, which has sparked serious concerns regarding consumer privacy.
Some of the information collected by Smart TVs, such as channels watched or videos rented and accessed, is data we, as consumers, expected these TVs to have collected. Yet many Smart TVs also collect very personal information including a user’s zip code, email address, IP address, and for Smart TVs that provide voice, face or gesture recognition, they even collect voice and video recordings of users. Further, Smart TVs that are connected to an individual’s Wi-Fi network will extract data from any other devices that are also connected to that network, which may include personal files located on a computer, website history on a computer or cell phone, and even text messages. Additionally, this information can be collected by these Smart TVs irrespective of whether the TV or functionality has been turned on or off.
The information collected by Smart TVs is then used by these companies for various reasons, such as to provide the Smart TV services, to improve the company’s products and services, to understand how consumers use the company’s products, for marketing purposes and to deliver advertisements to consumers. Further, any voice recordings that were recorded by the Smart TV, may not only be forwarded to a third party who then transcribes the recordings into writing for use by these Smart TV companies, but the recordings may also be stored for future use by these manufacturers.
When it was discovered that consumers’ private conversations or actions were being recorded at all hours of the day by some Smart TVs, Smart TV companies began receiving complaints that such recordings were a violation of consumer privacy laws. In fact, in early 2015, a class action lawsuit was filed against Vizio for allegedly secretly collecting information about what its Smart TV users were watching, and sharing that information with advertisers without the users’ consent. Moreover, the complaint alleged that the data collected and shared by Vizio on its consumers’ viewing habits is insufficiently protected. The class action complaint asserts that this, and the fact that the data Vizio collects enables marketers to identify customers by name, is a violation of the federal Video Privacy Protection Act (VPPA). Further, the lawsuit alleges that consumers were misled by Vizio about how their data would be used, which may violate California privacy law.
In response to this widespread concern over consumer privacy, federal and state governments recently began taking legislative action regarding the information collected and used by Smart TV companies. The Federal Trade Commission announced that it plans to explore consumer protection issues raised by new technologies including Smart TVs. The agency is conducting a seminar December 7, 2016, in order to address questions such as how much consumers understand about the tracking of their TV-viewing activity, how the ad industry is using data about the programs people watch, and how best to protect consumers’ privacy.
In California, Assembly Bill 1116, which took effect January 1, 2016, prohibits a person or entity from providing a Smart TV voice recognition feature without informing the user of that feature during the initial setup or installation of the Smart TV. AB 1116 also prohibits the sale of any voice recordings, that were collected and saved for the purposes of improving the functionality of the Smart TV voice recognition feature, to third parties for advertising purposes. Lastly, AB 1116 prohibits a person or entity from compelling a manufacturer or other entity from building a specific functionality within the voice recognition feature for the purpose of allowing an investigative or law enforcement officer to monitor communications through that feature. This will preclude law enforcement from being able to use Smart TVs for real-time surveillance. However, this bill does not prevent law enforcement from obtaining voice recordings at a later date pursuant to a warrant.
The privacy laws relating to Smart TV consumers have been quickly developing in response to the fast-paced advancement of Smart TV technology. Manufacturers can insulate themselves from liability by ensuring their compliance with federal and states privacy laws that relate to Smart TVs. Additionally, manufacturers should implement proper warnings that alert consumers to the fact that their Smart TVs may be recording certain sensitive or personal information. Manufacturers should also provide users with various options for turning off functionalities such as the voice, face or gesture recognition features. Since both Smart TV technology and the laws governing Smart TVs have been rapidly developing, we will be keeping track of any further developments in the law relating to Smart TVs and we urge others to do the same.
 The Vizio class action is titled In re: Vizio Inc. Consumer Privacy Litigation, MDL No. 2693.