Looks like the honeymoon between Philz Coffee and retail analytics company Euclid Elements is over. The breakup was aired in public yesterday when the popular Bay Area coffee shop’s CEO Jacob Jaber said that it’s going to discontinue its policy of tracking customers and passers-by who are equipped with wireless devices, a practice we reported on earlier this week.
— Philz Coffee (@PhilzCoffee) November 29, 2011
“We think [the tracking devices are] a useful way for us to help deliver a better customer experience,” Jaber told the Appeal last week. “What we’re particularly interested in is dwell time, so, for example, we can restructure the furniture in various locations to accommodate commuters or customers who camp out with their laptops.” The detection devices monitor the frequency and duration that Wi-Fi connected devices (cell phones, tablets, and laptops, for example) are nearby and within the shops, and have been active and in place since 2012.
Following the Appeal’s story, Jaber said that the company takes “privacy really seriously” and that the tracking program managed by Euclid will “no longer be active.” By as early as this weekend the devices will be out of the cafes, according to an ABC7 News broadcast.
When contacted by the Appeal this morning for comment on the decision to discontinue the tracking program, Jaber said, “I’d appreciate it if there wasn’t any update.” Jaber had made no bones about his displeasure with our earlier report, responding aggressively to customer queries on Twitter and by telling this reporter that we didn’t sufficiently emphasize that the collected data is anonymous and the company can’t spy on its customers — which Euclid confirmed that all the data is indeed anonymously presented to Philz.
Nonetheless, retail tracking remains a serious concern to digital liberties defenders the Electronic Frontier Foundation.
“There are no real meaningful technical constraints on this kind of monitoring,” EFF senior staff technologist Seth Schoen told the Appeal. “You can do it yourself with an ordinary laptop, just by running software that tells the laptop to pay attention to the hardware addresses attached to wireless signals in the vicinity. And there is no really meaningful way to detect who is monitoring you.”
The Euclid devices in places like Philz’s stores detect the “pings” Wi-Fi enabled devices send out while searching for networks to connect to. The “pings” include what’s called a device’s Media Access Control (MAC) address (which is kind of like a unique device serial number) that’s used by Euclid in aggregate to provide business intelligence, in order to, they say, to improve operations. It’s not just a business’s customers that are tracked, however: Euclid’s technology also scans devices of those passing by.
Schoen also pointed out that because Philz partners with Facebook and Cisco to set up the infrastructure in their stores, Facebook would theoretically be in a position to observe the MAC address alongside a Facebook user name — thereby establishing a correlation with a device owner’s actual identity, at least in theory.
When asked about this partnership, Jaber, Philz CEO, said the theory was too technical for him and that he didn’t understand what Schoen was talking about.
Euclid maintains that it’s not doing anything wrong, however. “We’re shoppers too,” said Euclid CEO Will Smith in a prepared statement, “so we wanted to create a powerful product that helps retailers optimize the shopping experience, while at the same time could be proud of as consumers. We’ve built our technology from the ground up with privacy in the fore-front, and none of the information we collect can ever be traced back to an individual.”
It appears, however, that consumer response to the news that Philz employed this technology convinced Jaber that Euclid was not the right fit for his business. Before privacy fans relax too much, however, the EFF’s Schoen reminds them that the real issue is not just with retailers like Philz or the retail analytics industry, it’s with wireless devices, themselves.
“I think that the ability to track a device’s physical location should be viewed as an engineering problem with the device itself and that cell phones (here, through their wifi interfaces) are an example of a device that has this flaw or misfeature, along with laptops and plenty of other communication devices.”