by Tyler Durden at ZeroHedge
After the Cambridge Analytica / Facebook scandal and the ensuing ‘reforms’ within the tech industry to reign in wanton data harvesting by predatory app-makers, one might be left with the impression that the practice had been reined in.
Yet, a deep-dive investigation by The Markup revealed that a popular family safety app used by 33 million people worldwide, Life360, has been selling data on the precise locations of children and other family members to around a dozen data brokers, who have in turn sold data to “virtually anyone who wants to buy it.”
Two former employees of Life360 as well as two individuals formerly employed by data brokers Cuebiq and X-Mode revealed that the Life360 app “acts as a firehose of data” for shady info brokers in an industry which has “few safeguards to prevent the misuse of sensitive information.”
When confronted with evidence, Life360 founder and CEO Chris Hulls had no qualms about his business model, telling The Markup: “We see data as an important part of our business model that allows us to keep the core Life360 services free for the majority of our users, including features that have improved driver safety and saved numerous lives.”
Selling data has become a crucial component of Life360’s revenue, jumping from $693,000 in 2016 to $16 million in 2020, comprising around 20% of its revenue that year, not including an additional $6 million from a partnership with Allstate’s Arity. While the company reported a loss of $16.3 million last year, Life360 – which is publicly traded on the Australian Securities Exchange, has plans for an IPO in the US.
Life360 reported a loss of $16.3 million in 2020. Financial disclosures show they made $16 million selling user location data in 2020 – making up nearly 20% of their revenue.
— Jon Keegan (@jonkeegan) December 6, 2021
According to the former X-Mode engineer, the raw location data from Life360 was one of the most valuable sources, as it included a massive volume of precise data. The former Cuebiq employee joked that the company wouldn’t be able to run marketing campaigns without Life360’s “constant flow of location data.”
The company maintains that it doesn’t sell data on any users under 13, in accordance with the Children’s Online Privacy Protection Rule (better known as “COPPA”), though they admitted that they do “disclose” information from younger children to third parties “as needed to analyze and detect driving behavior data, perform analytics or otherwise ,[sic] support the features and functionality of our Service,” but not for “marketing or advertising purposes.”…
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