Is privacy an afterthought in a smart home?

by Parks Associates | May. 14, 2019

Content Submitted by Universal Electronics Inc.

Voice assistants from Google and Amazon are attempting to be a unified interface for consumers to interact with different smart home devices and services, further integrating themselves into every aspect of consumers' daily lives. In the past, these tech giants collected data whenever their voice assistant was used to perform an activity by the consumer, such as turning on a light or locking a door.

According to a recent report by Bloomberg, they are now asking device-makers to send a continuous stream of information from connected devices; irrespective of whether or not the assistant was used to control the device, bypassing user agreements and asking device-makers to share data across companies.  As an example, TVs would be required to report the channel that is currently being watched, eliminating the user's privacy over content consumption; or smart locks would be required to notify at all times whether or not the door bolt is engaged, thereby informing the company about the user's occupancy.

Russell, an analyst from Parks Associates Inc., calls device-status reporting "a bit of a Trojan Horse request".

The new recommendation requires consumers to place their trust in these companies, and raises alarming questions around data privacy. Though this information may seem trivial at first, every device at home serves as a map of the consumer's personal life, providing sensitive information such as when the consumer comes home and what time everyone in the household goes to sleep. This gives companies a glimpse into the consumer's preferences, schedule, and adds a literal ear into the consumer's life giving them the ability to profile consumers and use the collected data for various purposes, including marketing.

Users agree to provide information when they ask a smart device to perform an action, but this consent extends only to provide specific companies with specific data and for the specific intended use. Any additional information gathered and shared beyond that requires another level of permission that is currently not requested. Is this a problem better solved with regulations?

Not only does this new recommendation raise major privacy concerns, but also public guidelines shared by primary market shareholders don't set limits on what they can do with the information they collect. Having an insight into what consumers do in their private spaces can open doors to much larger issues. Bloomberg quoted an Amazon spokesperson saying that the company doesn't sell user data and doesn't use information from device-status reports for advertising, but cannot share details on how the data is going to be used in the future or how long the data is saved. All pointing to the lack of a proven business model, making it a loss-leader to first capture as much market share as possible and decide to monetize later on, a potential reason why the primary market shareholders are investing heavily and subsidizing hardware and services.

As a smart home technology provider, we at Universal Electronics Inc. understand the value of data in providing better and richer experiences. We believe that is how a home can truly be smart. Finding the right balance between rich AI models based on complete user data vs. fair use of data with proper consent for application, should be an industry-wide initiative. We believe the following must start today to ensure that we can deliver on the promise of a smart home:

• User consent: Performing specific actions and sharing data requires user consent. A smart home device purchase means a consumer buys into a promise, whether stated explicitly or implicitly. They "approve" access to some data for a specific company to deliver a specific function. On anything beyond that, either through software updates, or integrations, companies need an explicit approval on what new data will be used, for what purpose, and by which company in terms that consumers can easily understand.

• Regulations: The process needs to be regulated by establishing industry-wide standards and protocols to specify the frontiers of data collected and shared.

• Level playing field: Consumers and companies must have a level playing field to avoid scenarios that result in a monopoly or duopoly; or those that limit chances of innovation, or risk consumer choice in the long run. This is easy to overlook when faced with decisions that are artificially influenced through free or subsidized services today, in hopes of building an unknown business model in the future without any boundaries imposed.

Smart homes have lasting effects in a consumer's life. For an aging population, a smart home is essential in controlling how we live in our homes as we age with the help of technology. To ensure that a user's data and conversations are not being compromised, we should regard privacy as a core feature of all voice assistants, rather than being an afterthought. While policies are catching-up to the realities of the technology and market, companies must do the right thing, not the easy thing.

Read more about how new recommendation raise major privacy concern 

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