Telematics for the automotive and insurance industries has been hailed as the “next big thing” that will “revolutionize the automotive industry.” The technology obviously has huge potential to improve highway safety, but it also raises gigantic concerns about consumer privacy that are scarcely — if ever — being voiced in the conversation about its future.
Vehicle telematics, in very rough terms, can be thought of as a hardware and software application (think black box) in an automobile that keeps track of everything about the vehicle after it leaves the manufacturer. The data is then wirelessly transmitted to the manufacturer. Another type of telematics is Usage Based Insurance, or UBI, which is a technology that allows insurance companies to collect consumer data about vehicle usage for things like underwriting and claims. This video, by Wireless Car, gives a good overview in describing the huge array of data types which are tracked about the driver and the vehicle.
Some of the data points tracked by vehicle telematics includes: where, when and how the vehicle is driven; speeds, turning ratios, and driving patterns; accidents and accident data; maintenance history; vehicle performance; and GPS data.
This data is then analyzed via the manufacturer’s presumably proprietary algorithm and can be used for a myriad of commercial or governmental purposes including: sharing or selling the data to insurance companies; tracking vehicle defects and trends; integration and coordination with the driver’s personal data such as a calendar; sharing the data with government regulators; selling the data to “big data” vendors; utilizing the data to study consumer lifestyle habits; identifying the specific behaviors of individual consumers; consumer surveillance; collection of forensic data for litigation; sharing the data with law enforcement authorities; any other commercial purpose not otherwise prohibited by law.
A recent study projected that by 2017 nearly 50% of vehicles will be shipped to consumers with “safety and security” telematics. The report comments that an important growth driver for the increase in telematics will be “government mandates.” Mandates? Really?
This technology sounds great on its surface. Safety? Check. Vehicle safety issues can theoretically be tracked and identified so that manufacturers can address problems early before people are hurt. Efficiency? Check. This tech offers huge potential for improvements in inventory efficiency for replacement parts, better accuracy in insurance underwriting, and factual accuracy for claims and litigation. All good.
But there is a ying to the yang. Some consumers might not want to have their every move tracked by a corporation. Especially when that data can be shared, sold, mashed up with other data, analyzed and used for potentially endless commercial and governmental purposes.
Some people were wigged out when they found out their internet browsers allowed cookies that tracked their browsing habits. Or when Facebook tracked user behavior and used the data for targeted advertising. Carrier IQ, a cellular data company, is currently in a maelstrom of federal class action lawsuits alleging that the company violated consumer privacy and federal wiretap laws because they secretly tracked consumer data on cell phones.
Telematics goes much further than merely tracking consumer cell phone or browsing data. This new technology tracks a consumer’s every physical move, action and behavior while in their car. To me it smacks of Orwellian corporate intrusion.
Surely it will be pitched as “in the public interest’, for the ‘greater social good,’ ‘important for safety’ and ‘collected in such as way that your privacy will be protected.’ Sure. Isn’t that what Google and Zuckerberg said? Once the data is collected there will be a massive financial pressure for the corporations to monetize the data to it’s maximum potential. In fact, they would probably have a fiduciary duty to their shareholders to maximize any profits they can squeeze from the data, notwithstanding any consumer interests in privacy to the contrary.
Perhaps many of today’s consumers who grew up with cookies and spyware won’t be offended by telematics. There’s no question that the technology has significant potential for improved highway safety. However: government mandates? For corporations to track personal behavior? I sure hope it doesn’t come to that.
The race to collect and sell big data for consumer behavior is today’s gold rush. Telematics is a new way for Big Business to pan for that gold. But there doesn’t seem to be much, if any current discussion among consumer advocates about the huge privacy concerns that that this new technology raises. Which is surprising.
Because there should be.