Here’s why marketers should not ignore this Supreme Court case
Marketers accustomed to utilizing the voluminous flow of data provided by mobile device carriers should keep an eye on an upcoming Supreme Court decision.
The massive flow of data emanating from mobile phones and sent by carriers into the ad and marketing ecosystem could hit a blockade in the Supreme Court.
A case set to be heard in October deals with the ability for law enforcement authorities to obtain location data about suspects through cellphone tower records. However, some say it could have implications for location data used by advertisers and marketers to segment and target audiences for ad campaigns, as well as to gather consumer insights.
The ecosystem that’s threatened
While much of the location data used for targeting and measuring ad campaigns is derived through mobile apps, a lot of it enters the marketplace directly via mobile carriers. Firms including SAP, IBM, HP and a burgeoning field of European startups including Zeotap and Smartpipe, have partnered with carriers to transform mobile data representing precise locations traversed by people into information used for marketing.
Verizon, Sprint and AT&T have built businesses that allow advertisers to aim ads directly at their subscribers, services that spin aggregated data into marketing insights showing companies what types of people are shopping in their stores or visiting competitor locations. In fact, Verizon bought AOL and Yahoo in part to acquire the ad systems and media needed to turn its data exhaust into ad dollars.
The issue at the core of the case on the Supreme Court docket, Carpenter v. United States, is what’s called the third-party doctrine. According to the doctrine, when someone voluntarily provides information to a third party — in this situation, her mobile carrier — she has no valid expectation of privacy or Fourth Amendment protections against unreasonable searches and seizures.
The US government’s argument in the Carpenter case holds that according to third-party doctrine, by using a mobile device, people wittingly consent to having their cellphone data used by the cellphone provider.
The case before the court
The case involves information used to convict Timothy Carpenter, who was found guilty of six robberies after cellphone data reflecting months of specific locations he visited — including places in the vicinity of the robberies — was provided to law enforcement without a warrant.
Carpenter’s team of attorneys, which includes representatives from the American Civil Liberties Union (ACLU), urged the Supreme Court to hear the case on appeal after the matter worked its way through the court system. In the documents filed with the Court, the lawyers acknowledged the third-party doctrine but said it was time to revisit the “cases from the 1970s” that established that doctrine: “Only this Court can provide the guidance they [lower courts] seek about whether and how a doctrine developed long before the digital age applies to the voluminous and sensitive digital records at issue here.”
If the court sides with Carpenter, said Pam Dixon, founder and executive director of World Privacy Forum, “Third-party doctrine will no longer apply to the location data coming through cellphone networks, and that’s extraordinary.”
The potential implications for modern marketers
Arguably, the reason telcos store mobile location data for extended periods of time in the first place is that it has commercial value to advertisers and marketers, as well as other entities.
However, if the Supreme Court rules in such a way as to delegitimize the third-party doctrine, there’s no telling whether it would also limit accessibility to mobile data for marketing purposes. Andrew Crocker, a staff attorney for the Electronic Frontier Foundation’s civil liberties team, says it won’t. “The Court’s decision will only determine the limits the Fourth Amendment places on the government’s ability to acquire location data, if any,” he stated in an email.
Mobile carriers and companies gathering location data through apps, WiFi, beacons and other sources rely on notifications in privacy policies, terms and conditions and sometimes mobile app opt-ins to justify location data collection and use. In addition to these industry standards for privacy notification and consent, much of the mobile data used for advertising and marketing purposes is stripped of personally identifiable information and aggregated, or pooled into large batches.
“In a criminal scenario, the exact opposite is needed — an exact breadcrumb of a person’s path through the world,” argued Rich Karpinski, an analyst at 451 Research who evaluates mobile operator strategies. That distinction, he suggested, will separate any court ruling regarding use of warrantless mobile data for law enforcement purposes from commercial uses like ad targeting.
There is a big distinction between law enforcement agencies and marketers when it comes to their purposes for seeking and using mobile location data, added Ross Shanken, founder and CEO of Jornaya, formerly LeadID. “Ad tech and martech are not searching your cellphone for records to use those records to convict you of a crime,” he said. “They are getting access to anonymous information to help have a more relevant conversation with you.”
Is aggregation enough to assure an adequate level of privacy?
Yet there are questions regarding whether the aggregation of data stripped of personally identifiable information is a viable means of protecting individuals’ privacy, as data and ad tech firms have argued for so long.
Academic research presented earlier this year at the International World Wide Web Conference concluded that aggregated mobile location data representing hundreds of thousands of users can be decoded to reveal the actual movements of specific individuals with about 73-91 percent accuracy. The paper, authored by an international group including computer scientist Pengyu Zhang of Stanford, showed that when mobile devices linger in locations for lengthy periods, the patterns can easily reveal them to be a home or workplace, allowing the data to be matched to individuals.
In addition, a 2015 study conducted at MIT and published by Science evaluated three months’ worth of credit card records for 1.1 million people, finding that just four data points were enough to re-identify 90 percent of individuals.
If anything, a case involving mobile location data being heard by the highest court in the land should give mobile data providers and marketers using this information pause, said Dixon. Ultimately at issue for marketers and firms operating in the mobile data space is the fact that the information available today can paint a remarkably rich portrait of individuals’ lives. Concluded Dixon, “It’s in industry’s best interest to take a step back and say, ‘Maybe we need to rethink all the location data we have a wealth of access to.’”