Who's watching who? Vizio caught spying, FTC says

State of NJ, FTC allege Vizio improperly tracked consumers' viewing habits

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TRENTON, N.J. - Heads up for people who own a Vizio: Your TV may have been spying on you, so to speak -- and then reporting back to the company.

The manufacturer and a subsidiary will pay $2.5 million to settle allegations that they surreptitiously tracked consumers' viewing habits and sold the information to marketing companies and data brokers, New Jersey officials said this week, according to the Associated Press.

The settlement ends parallel investigations conducted by the state of New Jersey and the Federal Trade Commission into the use of data-collecting technology on Vizio's smart TVs.

The FTC will get $1.5 million and the state will receive $1 million in the settlement.

The state will suspend $300,000 in civil penalties included in its settlement amount if Vizio complies with the agreement.

Vizio, which is based in Irvine, California, and a subsidiary, manufactured smart TVs that captured second-by-second information about video displayed on the sets, according to legal documents.

The data was then sold to marketing companies and data brokers to measure viewing habits, such as the effectiveness of ad campaigns, the AP reported.

The FTC explained it like this: “Vizio then turned that mountain of data into cash by selling consumers’ viewing histories to advertisers and others. And let’s be clear: We’re not talking about summary information about national viewing trends. According to the complaint, Vizio got personal. The company provided consumers’ IP addresses to data aggregators, who then matched the address with an individual consumer or household. Vizio’s contracts with third parties prohibited the re-identification of consumers and households by name, but allowed a host of other personal details – for example, sex, age, income, marital status, household size, education, and home ownership. And Vizio permitted these companies to track and target its consumers across devices.”

So basically, Vizio is accused of making money off who you are and what you watch.

"To settle the case, Vizio has agreed to stop unauthorized tracking, to prominently disclose its TV viewing collection practices, and to get consumers’ consent before collecting and sharing viewing information," the FTC said.

More than 11 million consumers have bought smart TVs from Vizio since 2010.

As to what you should do if you own a Vizio smart TV -- or any smart TV, really, if you’re worried about this sort of activity -- several published online reports suggest disconnecting your TV from your home internet service. Doing so will block your access to features such as Netflix (unless you have a separate streaming device, like a Roku or Chromecast). But it also means the company won't be able to record or send any data about your TV-watching habits. You could also check your TV's owner manual for instructions on how to turn off the "smart interactivity" feature, which was the setting allowing Vizio to collect data, according to the FTC.

Learn more from the FTC's blog.

Graham Media Group/The Associated Press