The FCC said Verizon (NYSE: VZ) will pay a $1.35 million fine and adopt a three-year compliance plan as part of a settlement related to the carrier's use of "super cookies."
Both Verizon and AT&T (NYSE:T) have used super cookies, a technology that involves inserting an undetectable and undeletable tacking ID into their subscribers' mobile Internet browsing activity. Both programs were disclosed in August 2014, although the FCC said it had determined that Verizon had been using super cookies as early as December 2012.
AT&T stopped using the technology in November 2014, but Verizon continued the program, finally allowing users to opt out in April 2015. The FCC said Verizon has agreed to notify its customers about its targeted advertising programs and will obtain users' opt-in consent before sharing data from super cookies with third-party partners.
The technology has been dubbed a super cookie because it is more powerful than a typical Web tracking cookie that users can delete. Super cookies are unique identifier codes that are attached to each website customers visit, creating a profile of their browsing histories.
The FCC noted that Verizon had asserted in 2014 that third-party advertising companies were unlikely to use super cookies to build consumer profiles or for other marketing purposes. But news reports in January 2015 claimed that a Verizon partner had used super cookies for unauthorized purposes, effectively overriding customers' privacy choices.
"Consumers care about privacy and should have a say in how their personal information is used, especially when it comes to who knows what they're doing online," FCC Enforcement Bureau Chief Travis LeBlanc said in a prepared statement. "Privacy and innovation are not incompatible."
- see this FCC filing (PDF)
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