Consumers face digital TV privacy threat

Interactive TV is taking off - but the price may be more than some bargained for

Web users have grown used to the idea that companies collect information about their online habits as a price for providing them with all that free content -- but now TV viewers will have to grapple with the same issues.

Interactive television has leapt to more than a 25 percent penetration in the UK in the past year, but is bringing with it concerns about privacy and security.

A US group brought privacy concerns to the fore earlier this week, criticising set-top box maker TiVo for collecting more information on users' viewing habits than it let on. Industry analysts say the report will be just the beginning of the controversy, as consumers discover how much their home electronics know about their home lives.

"Any digital set top box networked in someone's home can pretty much record whatever anyone does on that box. There's always the potential for collecting that data with these boxes," said Tim Grimsditch, analyst with Forrester Research. "There's going to be a huge public flap over security and privacy with this."

The TiVo device, about the size of a video recorder, records television programming on a hard drive and can be programmed to play them back at any time. It also has other functions including pausing and rewinding live programming.

The box dials into a server via a telephone line to collect TV schedule information, and also sends users' viewing information back to TiVo. The company strips personal information off this data and plans to sell it to advertisers, who could pay for the chance of more personalised marketing.

TiVo, which is sold in the UK through British Sky Broadcasting, says Monday's report arose from incorrect information, and that it will only sell anonymous information to advertisers.

"No one outside your home, not even the TiVo staff or any of TiVo's computer systems, will ever have access to any of your personal viewing information without your prior consent," says a statement on the company's Web site, summarising the privacy policy.

Still, consumers may be uncomfortable with the idea that their video recorder is sending a detailed log of their viewing habits back to marketers.

What's more, digital television will soon be standard in the UK, with the government aiming to switch off analogue broadcasting within the next few years, and that will make it easier for companies to collect and sell viewing information.

Forrester estimates interactive television -- including interactive systems from BSkyB, ntl, Telewest and ONdigital -- more than doubled from 11 percent at the end of 1999 to 25.4 percent at the end of 2000.

But is there really anything new about impersonal, profit-driven companies collecting information about us? Perhaps not. "I don't think there's a real risk," said analyst Grimsditch. "In the end, it's being sold to marketers, not the Chinese government. We trust implicitly that phone companies won't sell our phone records to marketers to extract interesting information about us."

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