CDT to file complaint over Intel ID chip

The Centre for Democracy and Technology, a privacy and consumer rights group, said it will file a complaint with the Federal Trade Commission on Friday, citing Intel for unfair trade practices in bringing its processor ID to market.

It claimed that at least one major PC maker, IBM, has agreed to disable the ID technology in Intel's Pentium III microprocessors. "[Intel] has made several claims that we believe are false," said Ari Schwartz, spokesman for the CDT, on Thursday. The group is asking the FTC to take a stance and protect what it believes is an abuse of consumer rights. Details will not be available until Friday, said Schwartz.

Also on Thursday, the Electronic Privacy Information Centre, Junkbusters Corp., and Privacy International on Thursday sent a letter to major OEMs asking them not to ship PC equipped with the new Pentium III.

The groups believe the chip, which contains a controversial identification feature, could open up computer makers to litigation by consumers whose privacy is violated, said David Sobel, general counsel for EPIC.

Selling PCs while assuring users the ID feature is turned off could be risky for original equipment manufacturers in light of a German computer magazine's recent assertion that the feature is vulnerable to hackers, the letter states. "We believe that such a claim [that the ID feature is turned off] made under current circumstances could constitute a material misrepresentation of the sort prohibited by federal consumer protection laws and regulations," according to the letter, which was sent to the chief executive officers of Dell, Gateway, Compaq, Hewlett-Packard Co. and IBM.

"Intel has put the onus on the manufacturers, and that's not a good spot for them to be in," Sobel said. "If Dell sells me a PC and says this feature can't be turned on, and then it is turned on," resulting in a crime such as the theft of a credit card number or Social Security number, "then I'm going to turn around and sue Dell," he said.

While Junkbusters.com is asking PC makers to halt shipments, the CDT has merely asked them to turn off the processor ID in the basic system instructions, known as BIOS.

Jason Catlett, president of Junkbusters.com, applauded the move as a necessary step in the right direction. "The CDT went an extra step and that forces the FTC to respond with some sort of a ruling," he said.

On Thursday, IBM, in a letter to the CDT, said it would ship its systems with the processor ID turned off in BIOS. "IBM promotes and supports active industry leadership in tackling the privacy issues raised by the growth of the Internet and online commerce as a way to help foster this trust," said the IBM statement. "We lead by example."

Following initial complaints about the tracking technology, Intel asked PC makers to turn off the processor using a software utility. But on Wednesday, a German magazine reported that a way had been found to reactivate the processor ID even when a user thinks it has been switched off. "We have spoken with the CDT, and they have some difference in opinion with us," said Intel spokesman George Alfs. "But we have done nothing wrong."

The processor ID is a unique 96-bit identifier that has been placed on every Pentium III chip that Intel is now shipping to PC makers. Intel believes the ID is necessary for improved corporate asset tracking, network management, and -- eventually -- e-commerce.

The chip maker announced the product "feature" in January at the RSA Data Security Conference.