Technology that uses shoppers' personal cellphones to track their movements through a mall or store should not be used without their consent, U.S. Sen. Charles Schumer said Sunday.
Schumer said the British company that developed the so-called footpath technology should use an opt-in mechanism to give shoppers the choice whether they want their movements tracked.
"A shopper's personal cellphone should not be used by a third party as a tracking device by retailers who are seeking to determine holiday shopping patterns," said Schumer, D-N.Y. He added, "It shouldn't be up to the consumer to turn their cellphone off when they walk into the mall to ensure they aren't being virtually tailed."
The technology was developed by Portsmouth, England-based Path Intelligence. It already has been used in shopping centers in Europe and Australia, and it was used in at least two malls in the U.S. on Black Friday.
Cleveland-based mall operator Forest City said that after conducting a trial at two of its locations on Friday it would suspend further tests in part because of Schumer's concerns.
"Even though all information gathered by the system is anonymous, some consumers may still wish not to participate," said company spokesman Jeff Linton. "At present, the option for them to decline to participate is to turn off their mobile phones. ... We would like to pursue an easier "opt-out" option for consumers."
The technology uses antennas to capture the identification number assigned to each phone and track its movement throughout the stores. It can yield data such as how many Victoria's Secret shoppers also stop at Starbucks.
Path Intelligence has said the technology is not intended to spy on individual shoppers.
But Schumer said that if the data were hacked it could compromise personal information on shoppers' phones.
In a letter to Path Intelligence CEO Sharon Biggar, Schumer urged the company to obtain the explicit consent of shoppers' through an opt-in policy. He also called on Federal Trade Commission Chairman Jon Leibowitz to examine how this new technology fits in with existing consumer privacy regulations.
In an email, Biggar said that requiring an opt-in for her company's service would put real-world stores at a disadvantage as they compete with online retailers that track shoppers' behavior from the moment they enter a website.
"We are simply seeking to create a level playing field for offline retailers, and believe you can do so whilst simultaneously protecting the privacy of shoppers," she said, noting that her company alters the information it collects before it is stored.
"We never reveal data at an individual level, and we ask all of our clients to put up signage to let shoppers know that our system is in operation," Biggar said.