In the 2002 film Minority Report, video billboards scanned the irises of passing consumers and advertised to them by name. That was science fiction back then, but today's marketers are creating digital signs that can display targeted ads based on information they extract from examining the contours of individual human faces.
These smart signs are proliferating in commercial establishments and public places from New York's Times Square to St. Louis area shopping malls. They are a powerful innovation in advertising, but one that raises compelling privacy issues - issues that should be addressed now, before digital signs that monitor our behavior become the new normal.
The most common name for this medium is digital signage. Most digital signs are flat-screen TVs that run commercials on a continuous loop in airports, gas stations, and anywhere else marketers think they can get your attention. However, marketers have had difficulty determining exactly who sees the display units, which makes it harder to measure viewership and target ads at specific audiences. The industry's solution? Hidden facial recognition cameras.
The tiny cameras can estimate the age, ethnicity and gender of people passing by and can track how long a given person watches the display. The digital sign can then play an advertisement specifically targeted to whomever happens to be watching. Tens of millions of people have already been picked up by digital signage cameras.
While camera-driven systems are the most common, the industry is also utilizing mobile phones and radio frequency identification (RFID) for similar purposes. Some companies, for example, embed RFID chips in shopper loyalty cards. Digital kiosks located in stores can read the information on the cards at a distance and then display ads or print coupons based on cardholders' shopping histories.
Facial recognition, RFID and mobile phone tracking are powerful tools that should be matched by business practices that protect consumer privacy. All of these technologies have the capacity to identify individuals and gather personal data about them, though it remains unclear the extent to which the digital signage industry is using that capacity. Indeed, that is the problem.
To their credit, some of the companies using these tools have published privacy policies stating that they do not retain consumer information. However, other major companies that use these tools are completely silent on what they do with the information they collect by tracking consumers. Likewise, while the digital signage trade associations tout the potential of tracking technology to increase the industry's profits, none of the associations currently recommend any privacy safeguards.
Moreover, digital signage company representatives have refused to identity the locations of these smart signs, openly stating that they do not want people to know which signs are watching them. Such anti-consumer secrecy is a dangerous precedent for an industry hoping to cash in on surveillance.
This must change. The first step is for digital signage companies to develop and publish privacy policies specifying what information they collect, on whom, and to what uses it is put. Digital signage companies and trade associations should publicly adopt comprehensive guidelines that explicitly forbid retaining consumers' personal information and that commit to providing consumers with notice when audience measurement devices are in operation.
However, companies' privacy policies are subject to change at any time. Ultimately, baseline privacy legislation must be enacted for there to be any hope that consumer protection laws will catch up to modern technology. Such legislation should include a prohibition against the use of personally-identifiable biometric data (such as facial features) for commercial purposes without the informed consent of the individual consumer.
Some in the industry are likely to view proposals for privacy safeguards as premature because most digital signs don't yet retain images or identifying data on individuals. However, it is naïve to expect that will always be the norm when mining consumer data is so very profitable. The marketing business thrives on detailed audience information for tailored advertising. Indeed, the industry already acknowledges audience profiling as the key to its future success. There will be a greater push to identify individuals with digital signage as soon as it becomes more cost effective to do so.
Now is the time for digital signage privacy precisely because these audience measurement techniques are still somewhat new. It will be less difficult to build in privacy protections now than in the future, after companies are heavily invested in the systems and intrusive marketing too entrenched to halt. While an increase in spying-for-profit is inevitable in the age of digital marketing, the digital signage industry will be doing the public a grave disservice if this fancy new advertising medium becomes just another mass surveillance system with poor data management practices. Consumers and lawmakers need to speak up now, because a common standard for digital signage privacy is past due.
By Harley Lorenz Geiger
Special to CBSNews.com