Vizio to Pay FTC $2.2M For Tracking Smart TV Users’ Viewing Habits

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Vizio has agreed to pay $2.2 million to settle charges by the Federal Trade Commission that it illegally collected data on smart TV users’ viewing habits without their consent and then shared the information with advertisers and other companies.

The FTC filed the complaint in New Jersey federal court, alleging that since 2014 Vizio had been manufacturing smart TVs that continuously tracked what consumers were watching and that the company collected that data through software enabled by default.

“Vizio collected unique data from each household with a Vizio smart TV that included not only second-by-second viewing information, but also the household’s IP address, nearby access points, zip code, and other information,” the lawsuit states.

The FTC’s lawsuit also mentioned wired and wireless MAC addresses were captured as well as “ACR software captures up to 100 billion data points each day from more than 10 million Vizio” TVs; the data was stored indefinitely.

Vizio then shared all the data with third party analytic and media companies as well as advertisers, according to the FTC.

The data can be “enhanced;” the FTC explained it as Vizio “appending specific demographic information to the viewing data, such as sex, age, income, marital status, household size, education level, home ownership, and household value.” Vizio “sold this information to third parties, who used it for various purposes, including targeting advertising to consumers across devices.”

Under the terms of the FTC Vizio smart TV tracking settlement, Vizio will pay fines amounting to $2.2 million to both the FTC and the state of New Jersey for their actions.

Specifically, of the $2.2 million Vizio is to pay, $1.5 million will go to the FTC, $700,000 to the New Jersey Division of Consumer Affairs and the remaining amount will be allotted for legal fees and expenses.

Vizio must also update its disclosures, “separate and apart” from its privacy policy and terms of use, to “prominently” share what types of viewing data will be collected, used, and shared; with whom; and to what purpose. Additionally, any data collected prior to March 1, 2016, must also be destroyed, unless the consumer consents for Vizio to keep it.

Even with the FTC settlement, the legal battle isn’t over for Vizio. The company is also facing a consumer class action lawsuit in California federal court. Lead plaintiff Palma Reed is accusing Vizio of purposely concealing its tracking software from customers nationwide. Vizio has moved to dismiss the case on grounds the consumers are misinterpreting federal privacy laws.

The FTC and the state of New Jersey are represented by Kevin H. Moriarty and Megan E. Cox of the Federal Trade Commission; Christopher S. Porrino, Attorney General of the State of New Jersey; Steve C. Lee, Director of the New Jersey Division of Consumer Affairs; and Kent D. Anderson, Elliot M. Siebers, and Russell M. Smith Jr. – Deputy Attorneys General for the State of New Jersey.

The FTC New Jersey Vizio Smart TV Tracking Lawsuit is Federal Trade Commission, et al. v. Vizio Inc., et al., Case No. 2:17-cv-00758, in the U.S. District Court for the District of New Jersey.