Vizio revealed Monday that it has settled an investigation by the Federal Trade Commission (FTC) and the New Jersey Division of Consumer Affairs (NJ) into alleged data-mining practices through its smart TVs.
The Irvine, Calif.-based company agreed to pay $2.2 million to settle a lawsuit alleging it collected customers’ TV-watching habits. It also must delete all data gathered through its TVs’ data-mining software before March 1st, 2016.
Further, the action establishes a new best practices procedure consumer electronics manufacturers should employ before gathering viewer-specific data through their products and services. This will include clearly notifying purchasers in advance that the product they purchase will be used to gather viewing data and the manufacturer should obtain the permission of viewers before the data is gathered and used.
The lawsuit alleged that in 2014 Vizio began using software built into more than 11 million smart TVs to gather “highly-specific, second-by-second information about television viewing.”
Vizio then allegedly worked with another company to associate demographic information with each household, so that viewing habits could be paired with information about a viewer’s sex, age, income, marital status and other lifestyle specific details.
Although Vizio admitted to no wrong-doing, the data-mining practices worried some consumer watchdog groups that data would be sold to advertising and marketing agents, who could use it to solicit the sale of products and services and send spam to telephones and email accounts.
Vizio denied that they gathered the names or contact information of its smart TV customers through the data-mining software.
Read more on Vizio’s data-mining settlement after the jump: