252 posts categorized "Retail" Feed

'Map Your Orgasm' - A New Smart Device For Women

Recently, Mashable reported about a new smart device for women:

"The Lioness looks like a pretty standard vibrator on the outside, but inside it has four sensors that measure temperature, the force of muscle contractions, and track the movement of the device. When you’re done with your session, you can sync the Lioness with its app (available for iOS and Android). It then provides you with easy-to-read visualization of what was happening to your body while you were busy getting off. So, yes, essentially it gives you a map of your orgasm. You can also tag each session with different terms so you can track how your health, sleep, alcohol consumption, mood, etc. affect your experiences."

Gives you a map of your orgasm? That's a surprising description. Perhaps, I shouldn't have been surprised. First, there were online tools such as "map my ride" and map my run." Good stuff to help consumers stay healthy. I guess a tool resembling 'map your orgasm' was bound to happen.

Lioness sounds like a much better product name. To learn more, I visited the Lioness site. The home page featured this statement: "Don't worry, we will never share your email or spam you." That's a good start.

Privacy is important; especially with smart devices which collect intimate data about consumers. Earlier this year, news reports described a plan by a smart-device maker to resell the interior home maps its robovacs created. And, another smart vibrator maker paid hefty fines to settle allegations that it tracked users without their knowledge nor consent.

A wise person once said, "the devil is in the details." The privacy policy in a company's website is a good place to hunt for details. While blogging about privacy and identity theft during the last 10 years, I've read plenty of privacy policies. Plenty. I read the Lioness Privacy Policy (dated May 1) and found some notable sections:

"This Privacy Policy applies to our vibrators and other devices (“Devices”), our websites, including but not limited to lioness.io (individually a “Site” and collectively “Sites”), the Lioness software (“Software”) and Lioness mobile applications (the “Apps”). The Devices, Sites, Software and Apps are collectively referred to in this Policy as the “Lioness Service,” and by proceeding to use the Lioness Service you consent that we may handle the data that we collect from you in accordance with this Privacy Policy."

Pretty standard stuff so far. Warning: I'm not an attorney. If you want legal advice, hire an attorney. Like you, I'm just a regular consumer trying to understand smart devices while maintaining as much privacy as possible. Additional sections in the policy I found interesting:

"Sync Your Device
When you sync your Device through an App or the Software, data recorded on your Device is transferred from your Device to our servers. This data is stored and used to provide the Lioness Service and is associated with your account. Each time a sync occurs, we log data about the transmission. Some examples of the log data are the sync time and date, device battery level, and the IP address used when syncing."

Let's unpack that. The vibrator and its mobile app, record the date, time, and battery usage. Combine this with data collected from the four sensors and Lioness will know plenty about your usage: when (date and time), location, duration, preferred movement patterns, and more. It indeed could create a map. More sections in the policy:

"WHY WE COLLECT DATA
Lioness uses your data to provide you with the best experience possible, to help you learn about your body, and to improve and protect the Lioness Service. Here are some examples: i) Contact information is used to send you notifications and to inform you about new features or products... ii) Data and logs are used in research to understand and improve the Lioness Device and Lioness Service; to troubleshoot the Lioness Service; to detect and protect against error, fraud or other criminal activity; and to enforce the Lioness Terms of Service; iii) Aggregate data that does not identify you may be used to inform the health community about trends; for marketing and promotional use..."

Data That Could Identify You
Personally Identifiable Information (PII) is data that includes a personal identifier like your name, email or address, or data that could reasonably be linked back to you."

Hmmm. The policy does not list all data elements that personally identify you. For me, that's important to know. And, anything recorded on a smartphone can easily be linked to a person using her 10-digit phone number or the mobile device's serial number.

Informed shoppers probably want to know before purchase which other companies (e.g., business partners, affiliates, advertisers, etc.) Lioness shares data with. Its May 1, 2017 privacy policy also states:

"... companies that are contractually engaged in providing Lioness with services, such as order fulfillment, email management and credit card processing. These companies are obligated by contract to safeguard any PII they receive from us..."

"THIRD PARTIES
Lioness will not be responsible for the practices of third parties that Lioness does not own or control or individuals that Lioness does not employ or manage. The information provided by you to other third parties may be subject to their own privacy policies, which may differ from Lioness’s privacy policy. The Lioness Service may contain links to other sites, and we make every effort to only link to sites that share our high standards and respect for privacy. However, we are not responsible for the privacy practices employed by other sites..."

"DATA RETENTION
Lioness reserves the right to retain your PII for as long as your account remains active..."

So, the policy doesn't mention other companies by name. Not good. That makes it tough for consumers to make informed decisions.

Fitness tracking with the MapMyRide app On Facebook, many of my friends regularly share visual maps of their workouts. (See example on right.) That's their freedom of choice. So, some consumers are probably wondering if Lioness offers a similar share function. Again from the privacy policy:

"Community Posts
The Lioness Service may offer discussion forums, message boards, social networking opportunities, chat pages and other public forums or features in which you may provide personal information, materials and related content. If you submit personal information when using these public features, please note that such personal information may be publicly posted and otherwise disclosed and used without limitation or restriction."

So, the policy doesn't mention literal maps, per se. They might or might not provide the feature to users. The key takeaway: the responsibility rests upon the user. Don't share it if you don't want it made public.

It's probably helpful to also know that the product uses Bluetooth technology to perform data syncing. From the Lioness FAQ page:

"Wait...will there be bluetooth in my vagina?
Nope. We know that there are a lot of people who don’t like the idea of bluetooth being on while in use, so we made it so bluetooth automatically turns off when you use it."

Also, the FAQ page mentioned:

"Is my data stored securely and kept confidential?
Absolutely. We thought about privacy and security from the beginning for this product. You are the only one who can access your individual data. Everything is encrypted and we fully anonymize the data..."

That's good, but the privacy policy didn't mention data encryption. I expected it would. Not sure what to make of that.

Is the Lioness a good deal? Only you can decide for yourself -- and you should after reading both the privacy and terms-of-service policies.

Me? In my opinion, there seems to be too much wiggle-room for data sharing. The policy contains a lot of words and nothing special compared to other policies I've read. What are your opinions?


Russian Malware Targets Hotels In Europe And Middle East

FireEye, a security firm, has issued a warning about malware targeting the hotel industry within both Europe and the Middle East. The warning:

"... a campaign targeting the hospitality sector is attributed to Russian actor APT28. We believe this activity, which dates back to at least July 2017, was intended to target travelers to hotels throughout Europe and the Middle East. The actor has used several notable techniques in these incidents such as sniffing passwords from Wi-Fi traffic... Once inside the network of a hospitality company, APT28 sought out machines that controlled both guest and internal Wi-Fi networks... in a separate incident that occurred in Fall 2016, APT28 gained initial access to a victim’s network via credentials likely stolen from a hotel Wi-Fi network..."

The key takeaway: criminals use malware to infiltrate the WiFi networks at hotels in order to steal the login credentials (IDs, passwords) of traveling business and government executives. The criminals know that executives conduct business while traveling -- log into their employers' computer networks. Stealing those login credentials provides criminals with access to the computer networks operated by corporations and governments. Once inside those networks, the criminals can steal whatever of value they can access: proprietary information, trade secrets, customer lists, executives' and organization payment information, money, or more.

A variety of organizations in both the public and private sectors use software by FireEye to detect intrusions into their computer networks by unauthorized persons. FireEye software detected the breach at Target (which Target employees later ignored). Security researchers at FireEye discovered vulnerabilities in HTC smartphones which failed to adequately protect users' fingerprint data for unlocking phones.

Security warnings earlier this year mentioned malware by the APT28 group targeting Apple Mac users. The latest warning by FireEye also described the 2016 hack in more detail:

"... the victim was compromised after connecting to a hotel Wi-Fi network. Twelve hours after the victim initially connected to the publicly available Wi-Fi network, APT28 logged into the machine with stolen credentials. These 12 hours could have been used to crack a hashed password offline. After successfully accessing the machine, the attacker deployed tools on the machine, spread laterally through the victim's network, and accessed the victim's OWA account. The login originated from a computer on the same subnet, indicating that the attacker machine was physically close to the victim and on the same Wi-Fi network..."

So, travelers aren't safe even when they use strong passwords. How should travelers protect themselves and their sensitive information? FireEye warned:

"Travelers must be aware of the threats posed when traveling – especially to foreign countries – and take extra precautions to secure their systems and data. Publicly accessible Wi-Fi networks present a significant threat and should be avoided whenever possible."


The Bogus Claims By Broadband Providers And Their Allies About Net Neutrality

The Techdirt blog has called out -- in plain language -- the bogus claims and distortions by broadband providers about net neutrality rules. Techdirt reported:

"... one of AT&T, Comcast and Verizon's favorite bogus claims about net neutrality rules is that such consumer protections will somehow prevent the sick or disabled from getting the essential internet connectivity they need. For example, Verizon once tried to claim that the deaf and disabled would be harmed if large ISPs weren't allowed to create fast or slow lanes.. this claim that net neutrality rules somehow prevent ISPs from prioritizing essential medical technologies or other priority traffic has always been bullshit. The FCC's 2015 open internet rules (pdf) are embedded with numerous, significant caveats when it comes to creating fast and slow lanes... In fact, the existing rules go to great lengths to differentiate "Broadband Internet Access Service (BIAS),” (your e-mail, Netflix streams and other more ordinary traffic) from “Non-BIAS data services,” which can include everything from priority VoIP traffic to your heart monitor and other Telemedicine systems."

The U.S. Federal Communications Commission (FCC), led by Ajit Pai a former lawyer at Verizon, moved closer to eliminating net neutrality with a preliminary vote in May. For those who don't know or have forgotten, net neutrality is when consumers are in control -- consumers choose where to go online with the broadband they've purchased, and ISPs must treat all content equally. That means no blocking, no throttling, and no paid prioritization. Net neutrality means consumers stay in control of where they go online.

Without net neutrality, consumers lose the freedom of choice. ISPs will decide where consumers can go online, which sites you can visit, and which sites you can visit only if you pay more. ISPs will likely group web sites into tiers (e.g., slow vs. fast "lanes"), similar to premium cable-TV channels. Do you want your monthly internet bill as confusing, complicated, and expensive as your cable-TV bill? I don't, and I doubt you do either.

TechDirt highlighted other bogus claims:

... how net neutrality kills network investment) doesn't stop it from being circulated repeatedly by the army of politicians, think tankers, consultants, fauxcademics, and lobbyists paid to pee in the net neutrality discourse pool.

One of the core perpetrators of this myth is AT&T, which just scored a massive, lucrative $6.5 billion contract to build the nation's first, unified emergency first responder network: aka FirstNet... AT&T isn't worried about net neutrality rules harming medical services, since they've long-been exempted. AT&T's worried about one thing: any rules stopping it from abusing a lack of broadband competition to drive up prices and engage in anti-competitive behavior."

Back in May, the U.S. Federal Communications Commission (FCC) tmoved closer to eliminating net neutrality with a preliminary vote in May.

What can you do? Plenty. Now is the time for more concerned citizens to rise, speak up, and fight back. Write to your elected officials. Tell your friends, classmates, coworkers, and family members. Use this action form to contact your elected officials. Participate in local marches and protests. Join the Fight For The Future. Support the EFF.


Hacked Amazon Echo Converted Into Always-On Surveillance Device

Image of amazon Echo Wired reported how a white-hat hacker provided proof-of-concept that a popular voice-activated, smart home speaker could easily be hacked:

"... British security researcher Mark Barnes detailed a technique anyone can use to install malware on an Amazon Echo, along with his proof-of-concept code that would silently stream audio from the hacked device to his own faraway server. The technique requires gaining physical access to the target Echo, and it works only on devices sold before 2017. But there's no software fix for older units, Barnes warns, and the attack can be performed without leaving any sign of hardware intrusion."

Amazon sells both new and refurbished speakers. Newer models also include cameras. All are probably high-value targets of hackers and spy agencies.

Reportedly, Amazon has fixed the security vulnerability in newer (2017) models. The company advises customers to keep the software on their speakers current, and purchase speakers from trusted retailers. However (bold emphasis added):

"... Barnes agrees that his work should serve as a warning that Echo devices bought from someone other than Amazon—like a secondhand seller—could be compromised. But he also points out that, contrary to the implication of the company's statement, no software update will protect earlier versions of the Echo, since the problem is in the physical connection its hardware exposes.

Instead, he says that people should think twice about the security risks of using an Echo in public or semipublic places, like plans for the Wynn Hotel in Las Vegas to put an Echo in every room."

Voice-activated smart speakers in hotel lobbies and rooms. Nothing could go wrong with that. All it takes is a prior guest, or criminal posing as a hotel staff or cleaning person, to hack and compromise one or more older devices. Will hotels install the newer devices? Will they inform guests?

For guaranteed privacy, it seems hotel guests may soon have to simply turn off (or mute) smart speakers, smart televisions, and personal assistants. Convenience definitely has its price (e.g., security and privacy). What do you think?


Robotic Vacuum Cleaner Maker To Resell Data Collected Of Customers' Home Interiors

iRobot Roomba autonomous vacuum. Click to view larger image Do you use a robovac -- an autonomous WiFi-connected robotic vacuum cleaner -- in your home? Do you use the mobile app to control your robovac?

Gizmodo reports that iRobot, the maker of the Roomba robotic vacuum cleaner, plans to resell maps generated by robovacs to other smart-home device manufacturers:

"While it may seem like the information that a Roomba could gather is minimal, there’s a lot to be gleaned from the maps it’s constantly updating. It knows the floor plan of your home, the basic shape of everything on your floor, what areas require the most maintenance, and how often you require cleaning cycles, along with many other data points... If a company like Amazon, for example, wanted to improve its Echo smart speaker, the Roomba’s mapping info could certainly help out. Spatial mapping could improve audio performance by taking advantage of the room’s acoustics. Do you have a large room that’s practically empty? Targeted furniture ads might be quite effective. The laser and camera sensors would paint a nice portrait for lighting needs..."

Think about it. The maps identify whether you have one, none, or several sofas -- or other large furniture items. The maps also identify the size, square footage, of your home and the number of rooms. Got a hairy pet? If your robovac needs more frequently cleaning, that data is collected, too.

One can easily confirm this by reading the iRobot Privacy Policy:

"... Some of our Robots are equipped with smart technology which allows the Robots to transmit data wirelessly to the Service. For example, the Robot could collect and transmit information about the Robot’s function and use statistics, such as battery life and health, number of missions, the device identifier, and location mapping. When you register your Robot with the online App, the App will collect and maintain information about the Robot and/or App usage, feature usage, in-App transactions, technical specifications, crashes, and other information about how you use your Robot and the product App. We also collect information provided during set-up.

We use this information to collect and analyze statistics and usage data, diagnose and fix technology problems, enhance device performance, and improve user experience. We may use this information to provide you personalized communications, including marketing and promotional messages... Our Robots do not transmit this information unless you register your device online and connect to WiFi, Bluetooth, or connect to the internet via another method."

Everything seems focused upon making your robovac perform optimally. Seems. Read on:

"When you access the Service by or through a mobile device, we may receive or collect and store a unique identification numbers associated with your device or our mobile application (including, for example, a UDID, Unique ID for Advertisers (“IDFA”), Google Ad ID, or Windows Advertising ID), mobile carrier, device type, model and manufacturer, mobile device operating system brand and model, phone number, and, depending on your mobile device settings, your geographical location data, including GPS coordinates (e.g. latitude and/or longitude) or similar information regarding the location of your mobile device..."

Use the mobile app and your robovac's unique ID number can easily be associated with other data describing you, where you live, and your lifestyle. Valuable stuff.

Another important section of the privacy policy:

"We may share your personal information in the instances described... i) Other companies owned by or under common ownership as iRobot, which also includes our subsidiaries or our ultimate holding company and any subsidiaries it owns. These companies will use your personal information in the same way as we can under this Policy; ii) Third party vendors, affiliates, and other service providers that perform services on our behalf, solely in order to carry out their work for us, which may include identifying and serving targeted advertisements, providing e-commerce services, content or service fulfillment, billing, web site operation, payment processing and authorization, customer service, or providing analytics services.

Well, there seems to be plenty of wiggle room for iRobot to resell your data. And, that assumes it doesn't change its privacy policy to make resales easier. Note: this is not legal advice. If you want legal advice, hire an attorney. I am not an attorney.

The policy goes on to describe customers' choices with stopping or opting out of data collection programs for some data elements. If you've read that, then you know how to opt out of as much as possible of the data collection.

The whole affairs highlights the fact that the data collected from different brands of smart devices in consumers' homes can be combined, massaged, and analyzed in new ways -- ways in which probably are not apparent to consumers, and which reveal more about you than often desired. And, the whole affair is a reminder to read privacy policies before purchases. Know what valuable personal data you will give away for convenience.

Eyes wide open.

Got an autonomous robotic lawn mower? You might re-read the privacy policy for that, too.


National Parks: Buy Your Senior Pass Before the Price Hike

The U.S. National Park Service (NPS) is responsible for the care of the nation's parks. With 417 sites, its park system includes 129 historical parks or sites, 87 national monuments, 59 national parks, 25 battlefields or military parks, 19 preserves, 18 recreation areas, 10 seashores, four parkways, four lake shores, and two reserves. Last year, the NPS celebrated its 100th anniversary.

Visiting and camping within national parks are popular activities, especially during the summertime. More than 307 million persons visited the national park system during 2015. The NPS operates 879 visitor centers and contact stations. It employs more than 22,000 permanent, temporary, and seasonal workers. 440,000 volunteers assist those workers. Browse more NPS statistics (Adobe PDF), and the proposed 2018 budget to fix much deferred maintenance.

The NPS offers a variety of passes for frequent users and groups. Lifetime passes for seniors (age 62 or older) are a bargain since the pass holder can use it plus accompanying passengers is a single, private, non-commercial vehicle. The price of a senior pass will rise from $10.00 to $80.00 on August 28. For those counting, that is a 700 percent price increase!

U.S. citizens or permanent residents can buy passes. There are three ways to buy senior passes:

A $10.00 processing fee is charged for online and postal orders. Applicants must provide documentation proving citizenship and age. See the Frequently Asked Questions: Recreational Passes page (USGS site) for additional information, including forms of acceptable documentation. Within the parks and recreational sites, there may be additional fees for special services (e.g., camping, swimming, boat launch, specialized interpretive services). The senior pass may provide a 50 percent discount on these fees, but does not cover fees charged by concession stands.

Six agencies participate in the Interagency Pass Program: National Park Service, U.S. Forest Service, U.S. Fish and Wildlife Service, Bureau of Land Management, Bureau of Reclamation, and the U.S. Army Corps of Engineers. So, senior passes also provide access to other agencies' sites -- more than 2,000 sites in total.

Not a senior? Besides standard annual passes ($80.00 each), the NPS offers a variety of annual passes: free passes for military members and their dependents, passes for 4th grade students, free passes for persons with disabilities, and free passes for volunteers. To learn more, visit the NPS site and use its park search finder.

Want to buy your pass in person? Not all sites sell passes, so check this list of federal recreation sites that issue passes (Adobe PDF) for the site nearest to you.

I bought my senior pass as the Adams National Historic Park in Quincy, Massachusetts. The park includes the birthplaces of two presidents, the "summer White House," Stone Library, the Adams Carriage House, and 13 acres of a historic landscapes. Guided tours (April 19 - November 10) start at the visitor center (1250 Hancock Street, Quincy, MA), where senior, military, and 4th grade recreational passes can also be purchased in person.

National parks offer much to see and do. I've visited several national parks covering a wide variety of natural environments, scenery, and wildlife: Denali National Park, Glacier National Park, Grand Canyon National Park, Haleakala National Park, and Volcanoes National Park. Words and photos cannot express the beauty!

I want my grandchildren and great-grandchildren to be able to visit and see the natural wonders in our national parks. Have you visited a national park? Which is your favorite?


How Two Common Medications Became One $455 Million Specialty Pill

[Editor's Note: today's guest post, by the reporters at ProPublica, explores reasons for the high cost of prescription drugs for patients in the United States. Today's post is reprinted with permission.]

by Marshall Allen, ProPublica

Everything happened so fast as I walked out of the doctor's exam room. I was tucking in my shirt and wondering if I'd asked all my questions about my injured shoulder when one of the doctor's assistants handed me two small boxes of pills.

"These will hold you over until your prescription arrives in the mail," she said, pointing to the drug samples.

Strange, I thought to myself, the doctor didn't mention giving me any drugs.

I must have looked puzzled because she tried to reassure me.

"Don't worry," she said. "It won't cost you any more than $10."

I was glad whatever was coming wouldn't break my budget, but I didn't understand why I needed the drugs in the first place. And why wasn't I picking them up at my local CVS?

At first I shrugged it off. This had been my first visit with an orthopedic specialist and he, Dr. Mohnish Ramani, hadn't been the chatty type. He'd barely said a word as he examined me, tugging my arm this way and bending it that way before rotating it behind my back. The pain made me squirm and yelp, but he knew what he was doing. He promptly diagnosed me with frozen shoulder, a debilitating inflammation of the shoulder capsule.

But back to the drugs. As an investigative reporter who has covered health care for more than a decade, the interaction was just the sort of thing to pique my interest. One thing I've learned is that almost nothing in medicine 2014 especially brand-name drugs 2014 is ever really a deal. When I got home, I looked up the drug: Vimovo.

The drug has been controversial, to say the least. Vimovo was created using two readily and cheaply available generic, or over-the-counter, medicines: naproxen, also known by the brand Aleve, and esomeprazole magnesium, also known as Nexium. The Aleve handles your pain and the Nexium helps with the upset stomach that's sometimes caused by the pain reliever. The key selling point of this new "convenience drug"? It's easier to take one pill than two.

But only a minority of patients get an upset stomach, and there was no indication I'd be one of them. Did I even need the Nexium component?

Of course I also did the math. You can walk into your local drugstore and buy a month's supply of Aleve and Nexium for about $40. For Vimovo, the pharmacy billed my insurance company $3,252. This doesn't mean the drug company ultimately gets paid that much. The pharmaceutical world is rife with rebates and side deals 2014 all designed to elbow ahead of the competition. But apparently the price of convenience comes at a steep mark-up.

Think about it another way. Let's say you want to eat a peanut butter and jelly sandwich every day for a month. You could buy a big jar of peanut butter and a jar of grape jelly for less than 10 bucks. Or you could buy some of that stuff where they combine the peanut butter and grape jelly into the same jar. Smucker's makes it. It's called Goober. Except in this scenario, instead of its usual $3.50 price tag, Smucker's is charging $565 for the jar of Goober.

So if Vimovo is the Goober of drugs, then why have Americans been spending so much on it? My insurance company, smartly, rejected the pharmacy's claim. But I knew Vimovo's makers weren't wooing doctors like mine for nothing. So I looked up the annual reports for the Ireland-based company, Horizon Pharma, which makes Vimovo. Since 2014, Vimovo's net sales have been more than $455 million. That means a lot of insurers are paying way more than they should for their Goober.

And Vimovo wasn't Horizon's only such drug. It has brought in an additional $465 million in net sales from Duexis, a similar convenience drug that combines ibuprofen and famotidine, AKA Advil and Pepsid.

This year I have been documenting the kind of waste in the health care system that's not typically tracked. Americans pay more for health care than anyone else in the world, and experts estimate that the U.S. system wastes hundreds of billions of dollars a year. In recent months I've looked at what hospitals throw away and how nursing homes flush or toss out hundreds of millions of dollars' worth of usable medicine every year. We all pay for this waste, through lower wages and higher premiums, deductibles and out-of-pocket costs. There doesn't seem to be an end in sight 2014 I just got a notice that my premiums may be increasing by another 12 percent next year.

With Vimovo, it seemed I stumbled on another waste stream: overpriced drugs whose actual costs are hidden from doctors and patients. In the case of Horizon, the brazenness of its approach was even more astounding because it had previously been called out in media reports and in a 2016 congressional hearing on out-of-control drug prices.

Health care economists also were wise to it.

"It's a scam," said Devon Herrick, a health care economist with the National Center for Policy Analysis. "It is just a way to gouge insurance companies or employer health care plans."

Unsurprisingly, Horizon says the high price is justified. In fact, the drug maker wrote in an email, "The price of Vimovo is based on the value it brings to patients."

Thousands of patients die and suffer injuries every year, the company said, because of gastric complications from naproxen and other non-steroid anti-inflammatory drugs (NSAIDs). Providing pain relief and stomach protection in a single pill makes it more likely patients will be protected from complications, it said.

And Horizon stressed Vimovo is a "special formulation" of Aleve and Nexium, so it's not the same as taking the two separately. But several experts said that's a scientific distinction that doesn't make a therapeutic difference. "I would take the two medications from the drugstore in a heartbeat 2014 therapeutically it makes sense," said Michael Fossler, a pharmacist and clinical pharmacologist who is chair of the public-policy committee for the American College of Clinical Pharmacology. "What you're paying for with [Vimovo] is the convenience. But it does seem awful pricey for that."

Public outrage is boiling over when it comes to high drug prices, leading the media and lawmakers to scold pharmaceutical companies. You'd think a regulator would monitor this, but the Food and Drug Administration told me they are only authorized to review new drugs for safety and effectiveness, not prices. "Prices are set by manufacturers and distributors," the FDA said in a statement.

Horizon acquired Vimovo in November 2013 from the global pharmaceutical giant AstraZeneca. Horizon knew it faced challenges trying to get top dollar for inexpensive ingredients. "Use of these therapies separately in generic form may be cheaper," it said in its 2013 report to investors. But the company executed a shrewd strategy to give everyone -- insurers, patients, doctors and pharmacies -- the incentive to use Vimovo. It's instructive to review its playbook.

To get Vimovo covered, Horizon made deals with insurance payers and pharmacy benefit managers -- the intermediaries who help determine which drugs get reimbursed. The contracts generally included special rebates and even administrative fees for these intermediaries, the Horizon reports said, so the drug maker got paid much less than the sticker price, though it wouldn't say how much. But the company's net sales show the deals worked.

Horizon put boots on the ground to get the prescriptions rolling, expanding its sales force by the hundreds and focusing its marketing and sales efforts on doctors who already liked to prescribe brand-name drugs. The company's message to doctors emphasized the convenience of prescribing the two ingredients in a single pill and that the single pill protected patients by making it more likely they would take their medication as directed.

Horizon also primed the medical community by giving donations totaling $101,000 to the American Gastroenterology Association, a specialty nonprofit for physicians. Some doctors refuse drug-industry money, if only to at least avoid the appearance of a conflict of interest. ProPublica has done loads of stories showing why doctors taking money is indeed problematic, including one about drug makers' influence on physician specialty groups. When I went on the American Gastroenterology Association's website, the first thing I saw was a pop-up ad from a drug company. Several of the association's board members have received drug-company money, too. Horizon has made clear in its annual reports that donations to the group "help physicians and patients better understand and manage" the risks of pain relievers causing gastric problems.

Horizon also zeroed in on patients' worries about drug costs. To encourage them to fill their prescriptions, Horizon covered all or most of their out-of-pocket costs. That's why my doctor's office could promise me I wouldn't spend too much for my Vimovo. The program, Horizon told investors in reports, addressed the impact of pharmacies switching to less expensive alternatives and could "mitigate" the effect of payers searching for cheaper alternatives.

The strategy worked on me. I didn't even know why I was getting the prescription, but when they told me it wouldn't cost more than I would spend on lunch with a friend, I gave it the OK. A pharmacy I'd never heard of sent me a bottle of Vimovo for $10, even though my insurance company rejected the claim.

Turns out paying the patient's costs motivated my doctor, too. I waited until the end of my next visit to bring up Vimovo, and then we had a follow-up conversation on the phone. Ramani didn't know the price of the drug and found it "disturbing" when I told him. That was a surprise to me, but not to him. He said he leaves billing to his staff and doesn't even know how much he gets paid for a lot of the procedures he performs, let alone how much insurers are being charged for drugs. The marketing arms of companies like Horizon must count on this sort of blindness.

Ramani doesn't receive money or gifts from Horizon. (I confirmed this on ProPublica's Dollars for Docs website, which lists drug-company payments.) He said he likes Vimovo because Horizon covers the patient's out-of-pocket costs, entirely in many cases. Prescribing the generics or over-the-counter medications separately would actually cost more, he said. Which of course is exactly the company's plan. But Ramani agreed that the high cost of the drug to insurers ultimately raises overall health care costs for all Americans.

Knowing Vimovo's price, I asked him if he would continue to prescribe it. "It changes my thought process," he said. "But at the end of the day, I have to think about the patient and whether the patient will be able to pay out of pocket or not."

Ramani said the Horizon drug rep told him Vimovo prescriptions had to go through a particular pharmacy for the patient to receive financial assistance. In its 2016 annual report, Horizon wrote that prescriptions for its drugs might not be filled by certain pharmacies because of insurance-company exclusions, co-payment requirements, or incentives to use lower-priced alternatives. So that's why they didn't give me the option of picking up my pills at my neighborhood drugstore.

Instead, my Vimovo was mailed to me from White Oak Pharmacy in Nutley, New Jersey, which is about 45 minutes from my house. I drove there to find out why. The neighborhood pharmacy is on the bottom floor of a two-story brick building on a street corner, next to a hair salon.

Vishal Chhabria, the pharmacist who owns White Oak, told me the drug company sets the price of Vimovo. He insisted his pharmacy has no special relationship or contract with Horizon. Maybe the drug company steers prescriptions his way, he said, because his pharmacy will process the coupons that reduce or eliminate the patient costs, which some pharmacies don't.

Chhabria said there is no approved generic alternative to Vimovo, so he can't suggest one to patients. And while other drugs, like over-the-counter medications, would be cheaper for the health system overall, they are more expensive for the individual patient, he said.

In poring through Horizon's financial filings, it appears the drug's run may be ending. Horizon said in its report for the first quarter of 2017 that fewer insurance companies have been willing to cover Vimovo and many that do have demanded larger rebates. As a result, Horizon has been eating more of the costs of providing the drug to patients, as they must have in my case. The prescriptions have still been coming in, but net sales were just under $5 million in the first quarter of this year, down 81 percent from the first quarter of 2016.

Critics of Vimovo say that's still more than patients should be spending on the drug. "That number should be zero," said Linda Cahn, an attorney who advises corporations, unions and other payers to help reduce their costs. "If you want to talk about waste, that's waste."

Herrick, the health care economist, said Horizon cashed in by eliminating many of the barriers in the system that are meant to control costs. The company got patients on board by covering their out-of-pocket costs. It appealed to doctors by promoting the benefits to patients. And it did an end-run around chain pharmacies, which typically might suggest a lower-priced alternative, by steering prescriptions to pharmacists who would participate in their patient-assistance program.

"Somebody brainstormed: 'How can we nullify any consumer check and balance in this supply chain? What can we do to keep the customer from asking questions?'" Herrick said.

The scheme that played out with Vimovo is bound to happen again, Herrick said. Maybe it already is. Drug companies are always on the lookout to deploy similar strategies.

I dutifully took my Vimovo for several days, until I noticed it kept me awake until 3 in the morning 2014 a rare side effect. (Perhaps they need to add a third drug to the combo.) I probably have more than 50 pills left in the bottle on my bedside table. Maybe I could sell it back to Horizon for $1,500.

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Verizon To Exit Its Copper Wire Telephone Business In Several States In 2018

Verizon logo If your home uses a copper wire telephone service, often called a "landline" or POTS (e.g., Plain Old Telephone Service), you may soon have to make a change. In Boston, Verizon will abandon its landline business in June 2018.

On Saturday, my wife received a letter via postal mail from Verizon. We live in Boston. The "Notice of Copper Retirement" stated:

"Currently, Verizon brings voice and/or data services to your home over copper cables. However, the company is updating to fiber-optic technology in your area, and will be retiring its copper facilities that currently serve you and your neighbors.

To continue to provide you service, Verizon will have to move your service to these fiber-optic facilities. If fiber is available to your home now, we will be contacting you individually soon to schedule an appointment to transition your services to fiber. Otherwise, we will be contacting you once fiber is available. In either case, we will need to move your service well before we retire the copper in your area which is scheduled for on or after June 1, 2018

We will transfer your voice services from copper to fiber at no cost to you. This transfer will not result in any change to the voice service that you currently receive from Verizon. You may continue to subscribe to the same voice service at the same price, terms, and conditions. In addition, any devices that rely upon your voice service, such as fax machines, medical devices, or security alarms connected to a central station, will continue to work in the same way as they currently do over copper. We will also provide you with a battery backup device at no charge. For almost all residential customers, that device uses standard D-cell batteries that can support up to 24 hours of standby voice service during a commercial power outage. In case of a prolonged power outage, you can simply replace the batteries and extend the backup power.

If you subscribe to our High Speed Internet service, the migration to fiber will require a change since that service is not available on our fiber facilities. The Internet access service that we offer on fiber is FiOS Internet. FiOS Internet is available at significantly faster speeds than High Speed Internet. We will offer the service at a special rate for customers who migrate from copper to fiber facilities as a result of the retirement of our copper facilities. In some cases, this price may be lower or higher than what you currently pay for internet access.

Please review the Frequently Asked Questions for additional information about the fiber update or visit us at verizon.com/fiberupgrade. If you still have questions, please call us Monday through Friday, 8 a.m. - 8 p.m., or Saturday 9 a.m. - 5 p.n. at 1-877-439-7442.

You may also contact the Federal Communications Commission or your State Commission if you have any questions. Thank you for continuing to be a loyal customer. We greatly appreciate your business.

Sincerely

Janet Gazlay Martin
Director, Network Transformation

I visited the website mentioned in the notice. That site pitches the FiOS Internet service, and doesn't explain the company's copper landline retirement activities. You have to do a little digging online to find the locations where Verizon announced its retirement of copper-wire telephone services. The locations include several states in the Northeast and Middle Atlantic regions. Earlier this month, Verizon announced the retirement of copper landlines next year in the following states, cities, and towns:

  • Delaware: Newark, Ocean View
  • Maryland: Bethesda, Columbia, Glen Burnie, Rockville, Towson
  • Massachusetts: Danvers, Dorchester, Framingham, Hanover, Lawrence, Leominster, Marblehead, Newton, North Chelmsford, Roxbury, Stoughton, West Roxbury
  • New Jersey: Bergen, Berlin, Cape May, Cranford, East Dover, East Orange, Ewing, Freehold, Hackensack, Haddonfield, Journal Square, Marlton, Medford, Merchantville, Morristown, New Brunswick, Red Bank, Somerville, Toms River, Union City, Wall Township, Woodbury
  • New York: Cayuga Williamsville, Cornwall, Mineola, Mount Vernon, Plainview Central, Skaneateles, White Plains, and multiple areas within all of the five boroughs of New York City
  • Pennsylvania: Allentown, Dormont, Glenolden, Jefferson, Jenkintown, Mayfair, Mechanicsburg, portions of Philadelphia, Pilgrim, Turtle Creek, Wilkinsburg
  • Rhode Island: portions of Providence
  • Virginia: Arlington, Falls Church, Reston, Springfield, Virginia Beach, and portions of Richmond

The telecommunications company made similar announcements during February, 2017 about other areas within the same states. Verizon is not alone. Telephone companies have planned for years to abandon their their copper landline services. In August 2015, the Institute of Electrical and Electronics Engineers (IEEE) reported that the U.S. Federal Communications Commission (FCC):

"... set new ground rules for carriers seeking to replace their old copper telephone networks. Approved by a 3-2 vote at an open meeting yesterday, the rules require carriers to notify customers in advance and to seek FCC approval before reducing services... FCC chairman Tom Wheeler and others have been pushing to shift telephone traffic to fiber optics and the Internet. Critics have charged that phone companies are allowing their old copper networks to decay to force customers to shift to fiber service. But some 37 million households —- many of them headed by elderly people —- remain on legacy copper, commissioner Mignon Clyburn noted at the hearing. Other holdouts live in rural areas that lack cellular and broadband service. Some prefer copper connections because they are independent of local power lines, and offer better 911 emergency service.

The FCC ruling requires that carriers notify retail customers at least three months before shutting down a copper network, and provide six-months notice to interconnecting carriers using the old lines. (Clyburn complained that that's much less time than the FCC gave before shutting down analog broadcast television, but voted for the measure anyway.) Carriers also must seek FCC approval if the telephone changeover would "discontinue, reduce or impair" service... In a separate vote, all five FCC commissioners agreed to require carriers to offer customers backup power supplies that maintain their phone service during prolonged power outages..."

You can read announcements by AT&T about copper landline retirements. CenturyLink notified the FCC last year about copper landline retirements in eight states: in Alabama, Florida, Michigan, Minnesota, Pennsylvania, Virginia, Washington, and Wisconsin.

Since the FCC set copper-retirement rules in 2015, technology adoption has climbed slightly. In January of this year, Pew Research reported that 77 percent of adults in the USA own a smartphone and 73 percent have broadband internet at home. However, while:

"... broadband adoption has increased to its highest level since the Center began tracking this topic in early 2000, not all Americans have shared in these gains. For instance, those who have not graduated from high school are nearly three times less likely than college graduates to have home broadband service (34 percent vs. 91 percent)... 12 percent of Americans say they are “smartphone dependent” when it comes to their online access – meaning they own a smartphone but lack traditional broadband service at home. The share of Americans who are smartphone dependent has increased 4 percentage points since 2013, and smartphone reliance is especially pronounced among young adults, nonwhites and those with relatively low household incomes."

While more people have smartphones and internet access at home, a sizeable number still have copper landlines. Phys.org reported in November 2016 the results of a recent survey:

"... 20 percent of the nation's households still view having a landline or fixed telephone as the most important of their telecommunications choices, according to a survey that queried consumers about their telephone and internet preferences... The study also found that for the average consumer, having mobile telephone service is about 3.5 times more important than a landline or fixed telephone service... Study findings suggest about 90 percent of American households have at least one mobile phone, 75 percent have fixed internet service, 58 percent have mobile internet service and 49 percent have fixed telephone service. Mobile telephone service was the most important service for the typical respondent, followed by fixed internet service, mobile internet service and fixed telephone service, although a portion rank fixed telephone first."

According to the 2012 United States Census, there are about 117 million households in the United States, and 2.59 persons on average per household. So, a substantial portion of the population will probably view negatively the termination of copper wire telephone services in their homes.

Verizon's copper termination notice was unnecessarily complicated, which could confuse many consumers. The portion of its notice which said "If fiber is available to your home..." was laughable. FiOS is already available in our neighborhood. Verizon notified me months ago, and I already migrated my antiquated DSL (Digital Subscriber Line) internet service on my phone line to FiOS. Verizon's landline business unit should know what its FiOS division is doing.The left hand should know what the right hand is doing.

So, Verizon's notice wasn't as customized nor as relevant as it could have been. It makes one wonder if, in its zeal to terminate its copper wire phone business, Verizon rushed the customer letters.

Readers of this blog remember the Boston City Council's hearings in 2015 about residents' requests for FiOS. In 2015, Verizon hadn't deployed FiOS even though it had been available in several suburban towns for many years. Example: a friend in Lexington has had FiOS since at least 2009. So, Verizon could have deployed FiOS far sooner, providing consumers more time to migrate their phone service without rushing.

What should consumers do? It depends upon your lifestyle. If you already have a smartphone, you may want to simply terminate your landline phone service and use your smartphone instead. If you don't have a smartphone, you can migrate your copper landline phone service to Verizon's FiOS fiber connection, to a smartphone, or to another telephone service provider. For example, many cable-TV providers, such as Comcast, provide phone service in residences.

Some consumers value security and privacy. If you perform phone-based banking or online banking with your desktop/laptop computer, then security is a concern. Since smartphones or wireless phones using home WiFi networks transmit using radio waves, you'll probably want to encrypt you wireless online banking transmissions to protect against theft by criminals or hackers. Several brands of Virtual Private Network (VPN) software and apps are available to encrypt your wireless transmissions. If you are unfamiliar with VPN software, this prior blog post contains links to online primers and tutorials.

If you received a copper termination letter from your phone company, what were your opinions of it? Did you switch to fiber landlines or to wireless?


Coming Soon: A New HD Video Standard For TV. Will Over-The-Air Broadcasts Remain Free?

Federal communications Commission logo Soon, consumers will hear about improvements in over-the-air broadcast television. Free, broadcast television has been around since forever, and High Definition (HD) broadcast signals have been around since 2009. Many consumers have chosen free, over-the-air broadcast television to avoid expensive monthly cable-TV bills.

Consumer Reports explained:

"Technically called ATSC 3.0, the new broadcast standard is—thankfully—being more generally billed as "Next-Gen Broadcast TV." There are a few big differences between our current ATSC 1.0 broadcasts and the new ones we'll receive as part of ATSC 3.0. A key one is that the new standard is IP (internet protocol)-based, which means it can carry internet content alongside traditional TV broadcasts. The broadcasts can also include 4K video and high dynamic range (HDR) content—the two biggest selling points in TVs right now."

And, consumers will be able to receive the new HD broadcast signals on their smart phones. Reportedly, the coming ATSC 3.0 standard will use a more efficient video format, called HEVC or H.265, which streaming services already use.

Last year, WRAL-TV in Raleigh, North Carolina began to broadcast using the new standard with a documentary, "Take Me Out To the Bulls' Game." The U.S. Federal Communications Commission (FCC) announced in February a Notice of Proposed Rulemaking (NPRM) which sought comments from the public about the new HD broadcast standard. That FCC announcement stated, in part:

"ATSC 3.0 has the potential to greatly improve broadcast signal reception on mobile devices and television receivers without outdoor antennas.  It is also intended to enable broadcasters to offer enhanced and innovative new features to consumers, including Ultra High Definition picture and immersive audio, more localized programming content, an advanced emergency alert system capable of waking up sleeping devices to warn consumers of imminent emergencies, improved accessibility options, and interactive services.

A coalition of broadcast and consumer electronics industry representatives petitioned the Commission to allow the use of the new standard. The upgraded technology is intended to merge the capabilities of over-the-air broadcasting with the broadband viewing and information delivery methods of the Internet using the same 6 MHz channels presently allocated for digital television (DTV)."

Like most things in life, details matter. Consumer Reports warned:

"... Jonathan Schwantes, senior policy counsel at Consumers Union, the policy and mobilization arm of Consumer Reports, says that some consumers could lose the ability to get some ATSC 1.0 signals if the host station is located farther away than their current broadcaster.

"Our position is that next-gen TV can and will be beneficial to consumers if implemented by the FCC in a measured and conscientious manner," he says. That could include making sure the current coverage areas are preserved as much as possible, not allowing broadcasters to downgrade the quality of ATSC 1.0 broadcasts from high to standard definition, and providing consumers with education on issues such as the timing of the transition and what new equipment they may need."

So, some broadcasters might choose to cut corners while migrating to the new standard: reduce their existing HD over-the-air signal strength, degrade their existing HD signal quality, or both. Not good.

And, there's more bad news for consumers. The new HD broadcast standard may cost more. You're probably wondering how, since over-the-air broadcasts have been free since television was introduced. Consumer Reports explained:

"... broadcasters could encrypt at least part of their programming, and require users to create an account and pay for access to certain features. No details are available on how this would work from the consumer's point of view. Consumers Union and other groups say they will insist that consumers continue to have access to free over-the air high-definition TV reception."

The new HD broadcast standard should not include hidden costs or new fees for consumers. For many consumers, new televisions are expensive and out of reach. Many consumers have chosen to "cut the cord" to save money. For these consumers, free over-the-air broadcast television is vital.

Nor should broadcasters be able to cut corners and force consumers to the new HD standard by degrading their existing HD signal strength and/or quality. The new HD broadcast standard should be voluntary for consumers. Nor should consumers be forced to submit to broadcasters their personal, contact, and payment information. One of the benefits of over-the-air broadcasts is privacy.

The next-gen TV standard offers benefits to both consumers and broadcasters. The FCC must balance the needs of both, and not serve only one group. The industry uses the term "Multi-channel Video Programming Distributors" (MVPD) to describe companies that provide video content. These MVPD companies include video producers and distributors: legacy cable-TV providers, TV networks, and others that provide programming via cable, the Internet, and over-the-air broadcasts.

Some MVPDs do both: produce and distribute video content. These MVPDs have a financial bias to force consumers from free over-the-air broadcasts to their proprietary, higher cost distribution networks (e.g., cable, internet). Consumers must have the freedom to choose how they consumer video content, and not have a distribution network forced upon them via bundling, "retransmission consent system," or other MVPD tactics.

What are retransmission consent systems? This 16-142 filing by Consumer's Union, Public Knowledge, and New America's Open Technology Institute explained (Adobe PDF):

"It is increasingly axiomatic that, when MVPDs and broadcast groups engage in retransmission consent negotiations, consumers end up suffering, or footing the bill, or both. Increased broadcast retransmission consent fees are passed on to consumers by MVPDs who have little choice but to accept most broadcaster demands or face crippling blackouts.... Large MVPDs, and those which also own broadcast interests, also use the retransmission consent process to extract favorable terms, potentially limiting the growth or viability of competitive video services. Comcast, for example, is rumored to have fleshed out its fledgling over-the-top (OTT) service by exercising most-favored-nation clauses in many of its carriage contracts. Comcast can only demand such favorable contract terms due to its dominant position in the video delivery marketplace, and once again, consumers are left holding the bag..."

So, the FCC must not make things worse for consumers by allowing the new HD broadcast standard to reduce competition and raise prices. Higher prices may be good for MVPDs (and their stockholders) but not for consumers.

If you want to submit a comment or read comments already submitted about the new HD broadcast standard, search for the 16-142 Filing within the FCC's Electronic Filing & Comment System (ECFS). At press time, only 167 persons, companies, and entities had submitted filings and comments (compared to 2,869,632 comments via ECFS about Net Neutrality). Not good.

What are your opinions about the new HD video broadcast standard?


Attorneys General In Several States Announce Settlement Agreements With Target

Target Bullseye logo The Office of the Attorney General (AG) for the Commonwealth of Massachusetts announced on Wednesday that the state will receive $625,000 as part of the settlement agreement with Target Corporation. The settlement agreement, which includes 47 states plus the District of Colombia, resolves claims by states about the retailer's massive data breach in 2013.

Card issuers had also sued the retailer. Target settled with Visa in August, 2015 to resolve claims in which 110 million consumers' records were stolen, including 40 million credit- and debit-card numbers. Also, debit card PIN numbers were stolen.

The announcement by Massachusetts AG Maura Healey explained:

"The investigation found that the stolen credentials were used to exploit weaknesses in Target’s system, which allowed the attackers to access a customer service database, install malware on the system and then capture data from credit or debit card transactions at Target stores (including stores in Massachusetts) from Nov. 27, 2013 to Dec. 15, 2013. The stolen data included consumers’ full names, telephone numbers, email addresses, mailing addresses, payment card numbers, expiration dates, security codes, and encrypted debit PINs... The breach affected more than 41 million customer payment card accounts and contact information for more than 60 million customers nationwide. In Massachusetts, the breach compromised information from approximately 947,000 customer payment card accounts and other personally-identifying information of about 1.5 million Massachusetts residents."

Terms of the settlement require Target:

"... to develop, implement and maintain a comprehensive information security program and to employ an executive or officer who is responsible for executing the plan. The company is required to hire an independent, qualified third-party to conduct a comprehensive security assessment... to maintain and support software on its network; to maintain appropriate encryption policies, particularly as pertains to cardholder and personal information data; to segment its cardholder data environment from the rest of its computer network; and to undertake steps to control access to its network, including implementing password rotation policies and two-factor authentication for certain accounts."

California will receive $1.4 million from the settlement. New York AG Eric T. Schneiderman said about the settlement agreement:

"New Yorkers need to know that when they shop, their data will be protected... This settlement marks an important win for New Yorkers – bringing over $635,000 into the state, in addition to the free credit monitoring services for those impacted by the data breach, and key security improvements to help protect Target consumers moving forward."

Yes, indeed. Shoppers everywhere need to know their data will be protected.

Besides Massachusetts, New York and California, the other states participating in this settlement include Alaska, Arizona, Arkansas, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, and the District of Columbia.

AL.com reported:

"Alabama won't be cashing in on the largest multi-state data breach settlement in history, however. The reason, according to the Alabama Attorney General's Office, is the absence of a state law that requires entities to notify customers whose information could have been exposed in a breach and then take steps to remediate any injuries.

"Alabama is one of the few states in the nation that is not a party to the recent Target settlement because our state does not have data breach notification law," said Mike Lewis, Communications Director for the Office of the Alabama Attorney General."

Connecticut and Illinois led the states' investigation. The participating states have not yet announced how the settlement money will be distributed.

[Editor's Note: a prior version of this blog post did not include the report by AL.com.]


Hacking Group Reported Security Issues With Samsung 8 Phone's Iris Recognition

Image of Samsung Galaxy S8 phones. Click to view larger version The Computer Chaos Club (CCC), a German hacking group founded in 1981, posted the following report on Monday:

"The iris recognition system of the new Samsung Galaxy S8 was successfully defeated by hackers... The Samsung Galaxy S8 is the first flagship smartphone with iris recognition. The manufacturer of the biometric solution is the company Princeton Identity Inc. The system promises secure individual user authentication by using the unique pattern of the human iris.

A new test conducted by CCC hackers shows that this promise cannot be kept: With a simple to make dummy-eye the phone can be fooled into believing that it sees the eye of the legitimate owner. A video shows the simplicity of the method."

The Samsung Galaxy S8 runs the Android operating system, claims a talk time of up to 30 hours, has a screen optimized for virtual reality (VR) apps, and features Bixby, an "... intelligent interface that is built into the Galaxy S8. With every interaction, Bixby can learn, evolve and adapt to you. Whether it's through touch, type or voice, Bixby will seamlessly help you get things done. (Voice coming soon)"

The CCC report also explained:

"Iris recognition may be barely sufficient to protect a phone against complete strangers unlocking it. But whoever has a photo of the legitimate owner can trivially unlock the phone. "If you value the data on your phone – and possibly want to even use it for payment – using the traditional PIN-protection is a safer approach than using body features for authentication," says Dirk Engling, spokesperson for the CCC."

Phys.org reported that Samsung executives are investigating the CCC report. Samsung views the Galaxy S8 as critical to the company's performance given the Note 7 battery issues and fires last year.

Some consumers might conclude from the CCC report that the best defense against against iris hacks would be to stop posting selfies. This would be wrong to conclude, and an insufficient defense:

"The easiest way for a thief to capture iris pictures is with a digital camera in night-shot mode or the infrared filter removed... Starbug was able to demonstrate that a good digital camera with 200mm-lens at a distance of up to five meters is sufficient to capture suitably good pictures to fool iris recognition systems."

So, more photos besides selfies could reveal your iris details. The CCC report also reminded consumers of the security issues with using fingerprints to protect their devices:

"CCC member and biometrics security researcher starbug has demonstrated time and again how easily biometrics can be defeated with his hacks on fingerprint authentication systems – most recently with his successful defeat of the fingerprint sensor "Touch ID" on Apple’s iPhone. "The security risk to the user from iris recognition is even bigger than with fingerprints as we expose our irises a lot. Under some circumstances, a high-resolution picture from the internet is sufficient to capture an iris," Dirk Engling remarked."

What are your opinions of the CCC report?


The Top Complaints About Financial Services. One Complaint Type Grew 325 Percent

Logo for Consumer Financial Protection Bureau After encountering unresolved issues with financial services, many consumers file complaints with the Consumer Financial Protection Bureau (CFPB). After each complain, the CFP works hard to get each consumer a reply within 15 days. This process allows the CFPB to track which issues affect most consumers, and to identify emerging problems.

According to its April Monthly Complaint Report, debt collection issues generated the most complaints on average, and complaints about student loans grew the fastest:

"As of April 1, 2017, the CFPB has handled approximately 1,163,200 complaints, including approximately 28,000 complaints in March 2017... Student loan complaints showed the greatest percentage increase from January - March 2016 (773 complaints) to January - March 2017 (3,284 complaints), representing about a 325 percent increase. Part of this year-to-year increase can be attributed to the CFPB updating its student loan complaint form to accept complaints about Federal student loan servicing in late February 2016. The CFPB also initiated an enforcement action against a student loan servicer during this time period."

CFPB Monthly Compalint Report. April, 2017. Table 1. Click to view larger version

The top five categories of complaints about during March, 2017:

  1. Debt collection: 8,711
  2. Credit reporting: 5,498
  3. Mortgages: 3,965
  4. Credit cards: 2,522
  5. Bank account or service: 2,476

Also during March: debt collection complaints represented about 31 percent of complaints; debt collection, credit reporting and mortgage were the top three most-complained-about consumer financial products and services. Together, these three categories represented 65 percent of complaints during March.

The top five categories of complaints since the CFPB began:

  1. Debt collection: 316,810
  2. Mortgages: 272,153
  3. Credit reporting: 195,826
  4. Credit cards: 118,732
  5. Bank account or service: 115,055

The CFPB began accepting complaints for different products and services at different times:

There were regional differences in complaint volume:

"Montana (54 percent), Georgia (46 percent), and Wyoming (45 percent) experienced the greatest complaint volume percentage increase from January - March 2016 to January - March 2017. New Mexico (-20 percent), Iowa (-5 percent), and Kansas (-0.7 percent) experienced the greatest complaint volume percentage decrease... Of the five most populated states, Texas (35 percent) experienced the greatest complaint volume percentage increase and Florida (8 percent) experienced the least complaint volume percentage increase from January - March 2016 to January - March 2017."

The report also tracks complaints by company:

CFPB Monthly Complaint Report. April, 2017. Figure 1. Click to view larger version

The CFPB reported additional details about student loan complaints:

"Approximately 32,700 (or 74 percent) of all student loan complaints handled by the CFPB from July 21, 2011 through March 31, 2017 were sent by the CFPB to companies for review and response. The remaining complaints have been found to be incomplete (7 percent), referred to other regulatory agencies (19 percent), or are pending with the CFPB or the consumer (0.5 percent and 0.4 percent, respectively)... The most common issues identified by consumers are problems dealing with their lenders or servicers (64 percent) and being unable to repay their loans (33 percent)."

"Federal student loan borrowers reported that when contacting their loan servicers regarding financial distress, servicers provided them with information on hardship forbearance or deferment, instead of potentially more beneficial repayment options like income-driven repayment plans... loan borrowers complained of difficulty enrolling in income-driven repayment plans. Borrowers reported lost documentation, extended application processing times, and unclear guidance when seeking to switch from one income-driven repayment plan to another."

Federal student loan borrowers described their experiences when trying to obtain guidance in completing annual income recertification for their income-driven repayment plan. Borrowers reported receiving insufficient information from their servicers to meet recertification deadlines and lengthy processing times. Some federal student loan borrowers stated their payments were misapplied. Borrowers reported overpayments were not applied to specified accounts but rather applied to all accounts managed by the servicer. Additionally, some borrowers’ overpayments—intended to reduce principal balance—were credited to the account as an early payment, resulting in their ac count reflecting a paid ahead status..."

To read more, download the full "April 2017: CFPB Monthly Complaint Report: Vol. 22" (Adobe PDF).


Speech By FCC Chairman. Time For Citizens To Fight To Keep Net Neutrality Protections

Federal communications Commission logo Earlier today, Ajit Pai, the Chairman of the U.S. Federal Communications Commission (FCC), gave a speech titled, "The Future Of Internet Freedom" at the Newseum in Washington, DC. He discussed the history of the Internet, regulation, business investment, innovation, and jobs. He also shared his views on regulation and a desire for the FCC's to pursue a "light touch" regulatory approach:

"First, we are proposing to return the classification of broadband service from a Title II telecommunications service to a Title I information service—that is, light-touch regulation drawn from the Clinton Administration.  As I mentioned earlier, this Title I classification was expressly upheld by the Supreme Court in 2005, and it’s more consistent with the facts and the law.

Second, we are proposing to eliminate the so-called Internet conduct standard. This 2015 rule gives the FCC a roving mandate to micromanage the Internet... The FCC used the Internet conduct standard to launch a wide-ranging investigation of free-data programs. Under these programs, wireless companies offer their customers the ability to stream music, video, and the like free from any data limits. They are very popular among consumers, particularly lower-income Americans... Following the presidential election, we terminated this investigation before the FCC was able to take any formal action. But we shouldn’t leave the Internet conduct standard on the books for a future Commission to make mischief.

And third, we are seeking comment on how we should approach the so-called bright-line rules adopted in 2015. But you won’t just have to take my word about what is in the Notice of Proposed Rulemaking. I will be publicly releasing the entire text of the document tomorrow afternoon..."

This should not be a surprise. We've heard much of this before from Congresswoman Blackburn, the author of the recently passed House legislation to roll back consumers' online privacy protection. Blackburn said the same about FCC reclassification; that it was bad, and that the internet wasn't broken. Well it was broken prior to to 2014, and in several specific ways.

The lack of ISP competition in key markets meant consumers in the United States pay more for broadband and get slower speeds compared to other countries. Rural consumers and low-income areas lacked broadband services. There were numerous complaints by consumers about usage Based Internet Pricing. There were privacy abuses and settlement agreements by ISPs involving technologies such as deep-packet inspection and 'Supercookies' to track customers online, despite consumers' wishes not to be tracked. Many consumers didn't get the broadband speeds ISP promised. Some consumers sued their ISPs, and the New York State Attorney General invited residents to check their broadband speed with this tool. Tim Berners-Lee, the founder of the internet, cited in March three reasons why the Internet is in trouble. His number one reason: consumers had lost control of their personal information. With all of this evidence, how can Pai and Blackburn claim the internet wasn't broken?

There are more examples. Some consumers found that their ISP hijacked their online search results without notice nor consent. An ISP in Kansas admitted in 2008 to secret snooping after pressure from Congress. Given all of this, something had to be done. The FCC stepped up to the plate and acted when it was legally able to; and reclassified broadband after open hearings. Then, the FCC adopted new privacy rules in November, 2016. Proposed rules were circulated prior to adoption. It was done in the open. It made sense.

Meanwhile, the rollback of FCC broadband privacy rules is very unpopular among consumers. Comments by Pai and Blackburn seem to ignore both that and key events (listed above) in broadband history. That is practicing the "revisionist history" Pai said in his speech he disliked. That leaves me questioning whether they can be trusted to develop reasonable solutions that serve the interests of consumers.

With their victory last month to roll back the FCC's online privacy protections, pro-big-telecom advocates claim they are acting in consumers' best interests. What bull. With that rollback, consumers are no longer in control of their information. (The opt-in and other controls were killed.) Plus, we live in a capitalist society where the information that describes us is valuable property. That's why so many companies want to collect it. Consumers should be in control of their online privacy and the information that describes them, not corporate ISPs.

Corporate ISPs' next target is "net neutrality." Pai referred to it in the "bright lines" portion of his speech. For those who don't know or have forgotten, net neutrality is when consumers are in control -- consumers choose where to go online with the broadband they've purchased, and when ISPs must treat all content equally. That means no blocking, no throttling, and no paid prioritization. Net neutrality means consumers stay in control of where they go online.

Pai claimed this was unclear. Again, more bull. The FCC's no blocking, no throttling, and no paid prioritization position was crystal clear.

Without net neutrality, ISPs decide where consumers can go online, which sites you can visit, and which sites you can visit only if you pay more. ISPs would likely group web sites into tiers (e.g., slow vs. fast "lanes"), similar to premium cable-TV channels. Do you want your monthly internet bill as confusing, complicated, and expensive as your cable-TV bill? I don't, and I doubt you do either.

Pai and Blackburn claim that net neutrality (and privacy) kills innovation. I guess that depends how you define "innovation." If you define innovation as the ability of ISPs to carve up the internet to maximize they profits where consumers pay more, then it should be killed. That's not innovation. That's customer segmentation by price and paid prioritization.

In his speech, Pai provided an appealing explanation about how ISPs spent less on infrastructure. He neglected to mention that decreased infrastructure spending was a choice by ISPs. They could have cut expenses elsewhere and continued infrastructure spending, but they didn't. Instead, ISPs chose the path we see: utilize a compliant, sympathetic Republican-led Congress and White House to get what they wanted -- the ability to charge higher broadband prices -- and use slick, misleading language to appear to be consumer friendly.

Take action today to defend net neutrality protections. Fight For The Future The Pai-led FCC isn't consumer friendly. The GOP-led Congress isn't, either. Regardless of how they spin it. Don't be fooled.

Anyone paying attention already knows this. Concerned citizens fought for and won net neutrality in 2014. Sadly, we might fight the net neutrality fight again.

It will be an uphill fight for two reasons. First, Republicans control the White House, House of Representatives, and Senate. Second, the Trump Administration is working simultaneously on rollbacks for several key issues (e.g., health care, immigration, wall along Mexican border, tax reform, environment, education, terrorism, etc.), making it easier to distract opponents with other issues (and with outrageous midnight tweets). Yet, people demonstrated last week at an open FCC meeting. (Video is also available here.) Now is the time for more concerned citizens to rise, speak up, and fight back. Write to your elected officials. Tell your friends, classmates, coworkers, and family members. Use this action form to contact your elected officials. Participate in local marches and protests. Join the Fight For The Future. Support the EFF.

Some elected officials have already committed to defend net neutrality protections:

What about your elected officials? Have they made a commitment to defend net neutrality? Ask them. Don't be silent. Now is not the time to sit on the sideline and wait for others to do the fighting for you.


A Cautionary Tale About The Internet Of Things And The CRFA

The internet-of-things devices consumers installed in their homes aren't really theirs. Oh, consumers paid good money for these smart devices, but the devices aren't really theirs. How so you ask? The cautionary tale below explains.

Unhappy with Garadget, an internet-connected garage-door opener he bought, Robert Martin posted negative reviews on both Garadget's official discussion board (username: rdmart7) and on Garadget's Amazon page. Unhappy with those negative reviews, Denis Grisak, the device's creator, responded initially by disabling internet access to the mobile app Martin used to operate his device. Grisak angrily said Martin could return his device for a refund.

You might call that a digital mugging.

The disagreement escalated and Grisak also disabled Martin's access to the Garadget discussion board and to Martin's online profile. You can read the entire story by The Atlantic. There are several items to learn from this incident. First, as The Atlantic concluded:

"Even just an angry moment can turn a smart device into a dead one."

Clearly, the device creator overreacted by disabling internet access. Grisak later softened his position and restored Martin's online connections. However, the incident highlights the fact that in the heat of the moment, angry (or ethically-challenged) and revengeful device makers can easily and quickly disable smart devices. It doesn't matter that consumers legally paid for those devices.

Second, end-user license agreements (EULA) matter. Terms of service policies matter. Most consumers never read these documents, and they matter greatly. The incident is a reminder of the "gag clauses" some companies insert into policies to silence negative reviews. This incident highlights a technical tactic ethically-challenged device makers can use to enforce gag clauses.

And it's not only device makers. In 2009, some physicians tried to force patients to sign, “Consent And Mutual Agreement to Maintain Privacy” (MAMP) policy documents. Don’t be fooled by the policy name, which is a fancy label for a gag clause. The policy document usually requires the patient to give up their rights to mention that physician on any social networking sites.

Third, legislation and consumer protections matter. The Atlantic reported:

"Some commenters on Amazon and Hacker News wondered whether Grisak’s public online revenge was legal. One person encouraged Martin to reach out to his state attorney general’s office. That’s a complicated question... A bill signed into law signed in December prohibits companies from including “gag clauses” in the contracts they enter into with customers, meaning they can’t bring legal action against someone just for a negative review."

That new law is the "Consumer Review Fairness Act" (CRFA - H.R. 5111) which protects consumers' rights to share their honest opinions online about any product or service.The U.S. Federal Trade Commission (FTC) explains the CRFA and provides guidance:

"The law protects a broad variety of honest consumer assessments, including online reviews, social media posts, uploaded photos, videos, etc. And it doesn’t just cover product reviews. It also applies to consumer evaluations of a company’s customer service... the Act makes it illegal for a company to use a contract provision that: a) bars or restricts the ability of a person who is a party to that contract to review a company’s products, services, or conduct; b) imposes a penalty or fee against someone who gives a review; or c) requires people to give up their intellectual property rights in the content of their reviews.

The [CRFA] makes it illegal for companies to include standardized provisions that threaten or penalize people for posting honest reviews. For example, in an online transaction, it would be illegal for a company to include a provision in its terms and conditions that prohibits or punishes negative reviews by customers. (The law doesn’t apply to employment contracts or agreements with independent contractors, however.) The law says it’s OK to prohibit or remove a review that: 1) contains confidential or private information – for example, a person’s financial, medical, or personnel file information or a company’s trade secrets; 2) is libelous, harassing, abusive, obscene, vulgar, sexually explicit, or is inappropriate with respect to race, gender, sexuality, ethnicity, or other intrinsic characteristic; 3) is unrelated to the company’s products or services; or 4) is clearly false or misleading."

However, the CRFA won't stop device makers from disabling the mobile apps and/or smart devices of consumers who have posted negative reviews. And, an online search easily retrieves physicians' sites still displaying MAMP policy documents. I guess that not everyone is aware of the CRFA.

Fourth, the consumer backlash has begun against smart devices with allegedly poor security. The @Internetofshit blogger (on Twitter and on Facebook) tracks and discusses such devices and device makers' actions that allegedly violate the CRFA. The discussion recently included Garadget:

Tweet by Internetofshit blogger about Garadget. Click to view larger version

What are your opinions of the Garadget incident? Of the CRFA? Of smart device security?


President Trump Signed Legislation Revoking FCC's Broadband Privacy Rules. Lots Of Consequences

Late yesterday, President Trump signed legislation revoking broadband privacy rules adopted by the Federal Communications Commission (FCC). The rules would have kept consumers in control of their information online. Instead, internet service providers (ISPs) are free to collect, archive, and share at will without notice nor consent information about consumers' online activities (e.g., far more than browsing histories).

The legislation narrowly passed both in the Senate (50 - 48) and in the House (210 - 205). Proponents of the legislation claimed duplicate legislation. Representative Marsha Blackburn (R-Tenn.), who introduced the legislation in the House, said plenty recently according to Breitbart News:

"What we are doing is recalling a privacy rule that the FCC issued right at the end of the Obama administration, and the reason we are doing this is because it is additional and duplicative regulation... What the FCC did was clearly overreach. It gives you two sets of regulators that you’re trying to comply with, not one. So we are recalling the FCC’s rule, and that authority will go back to the FTC...”

"What the Obama administration did... they reclassified your Internet service as Title II, which is a common carrier classification. It is the rule that governs telephone usage... Those rules were put on the books in the thirties. So what the Democrats did... they reclassified Internet, which is an information service, as a telephone service, and then put those 1930s-era rules on top of your Internet service... They did that so they could tax it, so they could begin to regulate it..."

"You don’t need another layer of regulation. It’s like flashing alerts: We don’t need net neutrality. We don’t need Title II. We don’t need additional regulations heaped on the Internet under Title II. The Internet is not broken. It has done just fine without the government controlling it."

Not broken? The founder of the internet, Tim Berners-Lee gave three solid reasons why the internet is broken. His number one reason: consumers have lost control over their personal information.

And, Representative Blackburn either doesn't know history or has chosen to ignore it. Several problems have plagued the industry: a lack of ISP competition in key markets, consumers in the United States pay more for broadband and get slower speeds compared to other countries, and numerous privacy violations and lawsuits:

Clearly, the FCC had to act, it did, it held hearings, and then finalized improved broadband privacy rules to help consumers. Now, the Congress and President undid all of that.

There are plenty of consequences. To regain some online privacy lost due to the new legislation, many consumers have considered Virtual Private Networks (VPNs) and other online tools to prevent ISPs from spying on them. VPNs are not a cure-all. ISPs can still block or throttle consumers' VPN connection, and VPNs won't protect e-mail nor internet-of-things devices installed in homes.

Basically, there is no substitute for consumers being in control of their online privacy with transparent notice by ISPs. The impact upon consumers: less online privacy and higher internet prices. Consumers are forced to spend more money on VPN and other tools.

Blackburn and others claimed that the U.S. Federal Trade Commission (FTC) should regulate ISPs. Regulation by the FTC is not a slam-dunk. AdAge reported:

"If the FTC does regain its oversight, the result is likely to be weaker privacy protections than what the FCC intended with its rules, as well as a relatively clear path for telcos to pursue their data-revenue-generating goals... One legal peak to climb: precedent set by a U.S district court ruling siding with AT&T against the FTC last year which carved out an exemption for companies that provide bundled phone and ISP services which effectively protected AT&T from FTC regulations protecting consumers from unfair or deceptive practices.

Even if the FTC eventually garners ISP jurisdiction, argued [Gigi Sohn, a senior counselor to former FCC Chairman Tom Wheeler], "it will lead to some privacy protection but much weaker than what people just lost." She pointed to FTC Chairman Ohlausen's high bar for showing harm against consumers before actions against companies are taken, noting, "She wants to see harm first. Well, rules protect you before you're harmed." "

Despite the claims by Blackburn and others, the bottom line is:

"... what we're left with is a period of uncertainty where the carriers may do certain things but it's unclear. Does the FCC have jurisdiction or does the FTC have jurisdiction?"

The Los Angeles Times reported:

"The FTC is empowered to bring lawsuits against companies that violate its privacy guidelines, but it has no authority to create new rules for industry. It also cannot enforce its own guidelines against Internet providers because of a government rule that places those types of companies squarely within the jurisdiction of the FCC and out of the reach of the FTC. As a result, Internet providers exist in a "policy gap" in which the only privacy regulators for the industry operate at the state, not federal, level, analysts say."

Ambiguity. Lack of clarity. Policy gap. None of those are good for business, or for consumers.

Read more about President Trump's signing of the legislation at C/Net and Reuters.


Tools For Consumers To Regain Some Online Privacy. Higher Internet Prices Likely

Now that the Republican-led Congress and President Trump have dismantled broadband privacy rules, internet service providers (ISPs) are free to collect, archive, and share at will without disclosure consumers' complete online activities (e.g., far more than browsing histories) to maximize their profits. Just about all of your online activities are harvested by ISPs, not just your browsing histories. Readers of this blog may remember the Deep-Packet Inspection software some ISPs installed on their servers to track their customers' online usage without notice nor consent.

To combat this, many consumers seek technical solutions, such as a virtual private network (VPN), to maintain as much privacy online as possible. Consumers will need to locate VPN and other tools than run on several devices (e.g., phones, tablets, laptops, desktops, etc.) and browsers (e.g., Firefox, Opera, etc.). Resources about several tools including VPNs:

Reviews and comparisons about VPN providers:

Some recommended, paid VPNs run on several platforms including Apple brand devices: F-Secure Freedome, Private Internet Access, and SurfEasy. Some VPNs offer a lower monthly price for a longer contract term. Look for pricing that covers multiple devices.

All of the above resources contain links to specific VPN brands. Experts recommend that consumers shop around for a paid VPN, since many of the free VPNs collect and resell consumers' information to make money. Some VPN providers offer phone customer service and support. This may be especially helpful for inexperienced users.

If a (free or paid) VPN saves usage logs of its customers' online activity and shares those logs with others (e.g., advertisers, affiliates, marketing partners, law enforcement, etc.), then that totally defeats the purpose of using a VPN service for privacy. So wise consumers shop around, read the terms of service, and read the privacy policy before signing up for a VPN.

Just like anti-virus software, several VPNs running on the same device can cause problems. So, you'll need to spend time sorting that out, too.

Sadly, VPNs are not a cure-all. Your ISP can still block or throttle your connection. Basically, there is no substitute for consumers being in control of their online privacy with transparent notice by ISPs. And, VPNs won't protect internet-of-things devices (e.g., appliances, refrigerators, thermostats, security systems, televisions, etc.) connected in to the WiFi router in your home. Tech Dirt reported:

"VPN clients are typically for desktop machines and, in some cases, mobile devices such as phones and tablets. As previously discussed, IoT devices in homes will continue to generate more traffic. Most such devices do not support VPN software. While it is conceivable that a user could set up an encrypted VPN tunnel from the home router and route all home traffic through a VPN, typical home gateways don’t easily support this functionality at this point, and configuring such a setup would be cumbersome for the typical user."

Note: VPN services don't protect e-mail. ISPs user a different set of servers for e-mail (e.g., SMTP, SMTPS) versus web browsing (e.g., HTTP, HTTPS). You might consider a secure e-mail service like ProtonMail. You might find this review of ProtonMail helpful.

Do you use Gmail? Remember Google scans both inbound and outbound e-mail messages supposedly to serve up relevant ads. While a certain amount of message scanning is appropriate to identify spam and malware, last month a federal court judge rejected a proposed settlement offer with non-Gmail users who had filed a class-action lawsuit because their e-mail messages had been scanned by Google (and they couldn't opt out of the scanning).

So, internet costs for consumers are going up with thanks to privacy-busting legislation passed by a Republican-led Congress. Consumers will pay more, perhaps an additional $50 - $80 yearly for VPN services, on top of already high monthly internet prices -- with a marginal increase in privacy; not the better, more complete solution consumers would have received with the FCC broadband privacy rules. Add in the value of your time spent shopping around for VPN and privacy tools, and the price increase is even greater.

Plus, monthly internet costs for consumers could go far higher if ISPs charge for online privacy. Is that possible you ask? Yep. Comcast and industry lobbyists have already stated that they want "pay-for-privacy" schemes. Congress seems happy to oblige corporate ISPs and stick it to consumers.

Petition to keep FCC broadband privacy rules and nullify Senate Joint Resolution 34 Mad about all of this? You probably are, too. I am. Be sure to tell your Senators and House representatives that voted to revoke FCC online privacy rules. Tell them you dislike the higher prices you're forced to pay to maintain privacy online.

Do any VPN providers act as fronts for government intelligence and spy agencies? I do not have the resources to determine this. Perhaps, some enterprising white-hat users can shed some light on this.

What online privacy resources have you found?


Maker Of Smart Vibrators To Pay $3.75 Million To Settle Privacy Lawsuit

Today's smart homes contain a variety of internet-connected appliances -- televisions, utility meters, hot water heaters, thermostats, refrigerators, security systems-- and devices you might not expect to have WiFi connections:  mouse traps, wine bottlescrock pots, toy dolls, and trash/recycle bins. Add smart vibrators to the list.

We-Vibe logo We-Vibe, a maker of vibrators for better sex, will pay U.S. $3.75 million to settle a class action lawsuit involving allegations that the company tracked users without their knowledge nor consent. The Guardian reported:

"Following a class-action lawsuit in an Illinois federal court, We-Vibe’s parent company Standard Innovation has been ordered to pay a total of C$4m to owners, with those who used the vibrators associated app entitled to the full amount each. Those who simply bought the vibrator can claim up to $199... the app came with a number of security and privacy vulnerabilities... The app that controls the vibrator is barely secured, allowing anyone within bluetooth range to seize control of the device. In addition, data is collected and sent back to Standard Innovation, letting the company know about the temperature of the device and the vibration intensity – which, combined, reveal intimate information about the user’s sexual habits..."

Image of We-Vibe 4 Plus product with phone. Click to view larger version We-Vibe's products are available online at the Canadian company's online store and at Amazon. This Youtube video (warning: not safe for work) promotes the company's devices. Consumers can use the smart vibrator with or without the mobile app on their smartphones. The app is available at both the Apple iTunes and Google Play online stores.

Like any other digital device, security matters. C/Net reported last summer:

"... two security researchers who go by the names followr and g0ldfisk found flaws in the software that controls the [We-Vibe 4Plus] device. It could potentially let a hacker take over the vibrator while it's in use. But that's -- at this point -- only theoretical. What the researchers found more concerning was the device's use of personal data. Standard Innovation collects information on the temperature of the device and the intensity at which it's vibrating, in real time, the researchers found..."

In the September 2016 complaint (Adobe PDF; 601 K bytes), the plaintiffs sought to stop Standard Innovation from "monitoring, collecting, and transmitting consumers’ usage information," collect damages due to the alleged unauthorized data collection and privacy violations, and reimburse users from their purchase of their We-Vibe devices (because a personal vibrator with this alleged data collection is worth less than a personal vibrator without data collection). That complaint alleged:

"Unbeknownst to its customers, however, Defendant designed We-Connect to (i) collect and record highly intimate and sensitive data regarding consumers’ personal We-Vibe use, including the date and time of each use and the selected vibration settings, and (ii) transmit such usage data — along with the user’s personal email address — to its servers in Canada... By design, the defining feature of the We-Vibe device is the ability to remotely control it through We-Connect. Defendant requires customers to use We-Connect to fully access the We-Vibe’s features and functions. Yet, Defendant fails to notify or warn customers that We-Connect monitors and records, in real time, how they use the device. Nor does Defendant disclose that it transmits the collected private usage information to its servers in Canada... Defendant programmed We-Connect to secretly collect intimate details about its customers’ use of the We-Vibe, including the date and time of each use, the vibration intensity level selected by the user, the vibration mode or patterns selected by the user, and incredibly, the email address of We-Vibe customers who had registered with the App, allowing Defendant to link the usage information to specific customer accounts... In addition, Defendant designed We-Connect to surreptitiously route information from the “connect lover” feature to its servers. For instance, when partners use the “connect lover” feature and one takes remote control of the We-Vibe device or sends a [text or video chat] communication, We-Connect causes all of the information to be routed to its servers, and then collects, at a minimum, certain information about the We-Vibe, including its temperature and battery life. That is, despite promising to create “a secure connection between your smartphones,” Defendant causes all communications to be routed through its servers..."

The We-Vibe Nova product page lists ten different vibration modes (e.g., Crest, Pulse, Wave, Echo, Cha-cha-cha, etc.), or users can create their own custom modes. The settlement agreement defined two groups of affected consumers:

"... the proposed Purchaser Class, consisting of: all individuals in the United States who purchased a Bluetooth-enabled We-Vibe Brand Product before September 26, 2016. As provided in the Settlement Agreement, “We-Vibe Brand Product” means the “We-Vibe® Classic; We-Vibe® 4 Plus; We-Vibe® 4 Plus App Only; Rave by We-VibeTM and Nova by We-VibeTM... the proposed App Class, consisting of: all individuals in the United States who downloaded the We-Connect application and used it to control a We-Vibe Brand Product before September 26, 2016."

According to the settlement agreement, affected users will be notified by e-mail addresses, with notices in the We-Connect mobile app, a settlement website (to be created), a "one-time half of a page summary publication notice in People Magazine and Sports Illustrated," and by online advertisements in several websites such as Google, YouTube, Facebook, Instagram, Twitter, and Pinterest. The settlement site will likely specify additional information including any deadlines and additional notices.

We-Vibe announced in its blog on October 3, 2016 several security improvements:

"... we updated the We-ConnectTM app and our app privacy notice. That update includes: a) Enhanced communication regarding our privacy practices and data collection – in both the onboarding process and in the app settings; b) No registration or account creation. Customers do not provide their name, email or phone number or other identifying information to use We-Connect; c) An option for customers to opt-out of sharing anonymous app usage data is available in the We-Connect settings; d) A new plain language Privacy Notice outlines how we collect and use data for the app to function and to improve We-Vibe products."

I briefly reviewed the We-Connect App Privacy Policy (dated September 26, 2016) linked from the Google Play store. When buying digital products online, often the privacy policy for the mobile app is different than the privacy policy for the website. (Informed shoppers read both.) Some key sections from the app privacy policy:

"Collection And Use of Information: You can use We-Vibe products without the We-Connect app. No information related to your use of We-Vibe products is collected from you if you don’t install and use the app."

I don't have access to the prior version of the privacy policy. That last sentence seems clear and should be a huge warning to prospective users about the data collection. More from the policy:

"We collect and use information for the purposes identified below... To access and use certain We-Vibe product features, the We-Connect app must be installed on an iOS or Android enabled device and paired with a We-Vibe product. We do not ask you to provide your name, address or other personally identifying information as part of the We-Connect app installation process or otherwise... The first time you launch the We-Connect app, our servers will provide you with an anonymous token. The We-Connect app will use this anonymous token to facilitate connections and share control of your We-Vibe with your partner using the Connect Lover feature... certain limited data is required for the We-Connect app to function on your device. This data is collected in a way that does not personally identify individual We-Connect app users. This data includes the type of device hardware and operating system, unique device identifier, IP address, language settings, and the date and time the We-Connect app accesses our servers. We also collect certain information to facilitate the exchange of messages between you and your partner, and to enable you to adjust vibration controls. This data is also collected in a way that does not personally identify individual We-Connect app users."

In a way that does not personally identify individuals? What way? Is that the "anonymous token" or something else? More clarity seems necessary.

Consumers should read the app privacy policy and judge for themselves. Me? I am skeptical. Why? The "unique device identifier" can be used exactly for that... to identify a specific phone. The IP address associated with each mobile device can also be used to identify specific persons. Match either number to the user's 10-digit phone number (readily available on phones), and it seems that one can easily re-assemble anonymously collected data afterwards to make it user-specific.

And since partner(s) can remotely control a user's We-Vibe device, their information is collected, too. Persons with multiple partners (and/or multiple We-Vibe devices) should thoroughly consider the implications.

The About Us page in the We-Vibe site contains this company description:

"We-Vibe designs and manufactures world-leading couples and solo vibrators. Our world-class engineers and industrial designers work closely with sexual wellness experts, doctors and consumers to design and develop intimate products that work in sync with the human body. We use state-of-the-art techniques and tools to make sure our products set new industry standards for ergonomic design and high performance while remaining eco‑friendly and body-safe."

Hmmmm. No mentions of privacy nor security. Hopefully, a future About Us page revision will mention privacy and security. Hopefully, no government officials use these or other branded smart sex toys. This is exactly the type of data collection spies will use to embarrass and/or blackmail targets.

The settlement is a reminder that companies are willing, eager, and happy to exploit consumers' failure to read privacy policies. A study last year found that 74 percent of consumers surveyed never read privacy policies.

All of this should be a reminder to consumers that companies highly value the information they collect about their users, and generate additional revenue streams by selling information collected to corporate affiliates, advertisers, marketing partners, and/or data brokers. Consumers' smartphones are central to that data collection.

What are your opinions of the We-Vibe settlement? Of its products and security?


Smart Mouse Traps: A Good Deal For Consumers?

Rentokil logo Rentokil, a pest control company, has introduced in the United Kingdom a new pest-control device for consumers wanting the latest WiFi technology. The company introduced ResiConnect, an Internet-connected mouse trap. A Rentokil representative explained to the Register UK newspaper:

“This is a trap that’s connected to the internet, essentially. Whereas there are other standard traps on the market that just catch and kill the mouse, that mouse can be caught in that trap for several weeks or several months. What this does is sends us a signal to notify us the trap has been activated, which allows us to respond... What this allows us to do is catch, kill and contain the mouse... and provide the best solution to the customer as well.”

Rentokil technician and vehicle Reportedly, the device sells for about £1,300, or about U.S. $1,300. Last summer, Rentokil Initial Plc announced a partnership with Google and PA Consulting Group (PA) to deploy globally the company's:

"... innovative digital pest control products and, in the future, to the development of ‘next generation’ services to offer customers new levels of proactive risk management against the threat of pest infestation... Rentokil has developed and begun to roll out its range of connected rodent control products particularly to customers in the tightly regulated food and pharmaceutical industries. In the field today, Rentokil has over 20,000 digital devices running in 12 countries which have now sent more than 3 million pieces of data.

The new digital pest control services use connected rodent devices with embedded sensors and mobile connectivity. The units communicate with Rentokil’s online ‘Command Centre’ and when they've caught a rodent, the technician is automatically alerted while customers are kept informed through myRentokil, the industry’s leading online portal... Built on Google’s Cloud Platform, and delivered by PA using Agile techniques, this technology is highly scalable and is now ready to be deployed more widely to existing and new customers from Q4 2016 and to other parts of the company..."

It seems that Rentokil is making available to consumers smart traps similar to those already deployed in the commercial market, such as fast food restaurants with multiple locations. Rentokil sells in the United States a device that uses radar to detect and capture mice. This raises the question: do consumers really need a smart mouse trap?

I have direct experience with mice. The building where I live is contains condominiums, and I have the responsibility to pay the condo association's monthly bills (e.g., water, insurance, and electricity), plus hire vendors and contractors, as needed, for repairs and maintenance. That includes pest control companies. Last week, our pest-control vendor deployed bait traps (e.g., poison and glue strips) in all units, plus the basement (with utilities and storage areas).

Obviously, owners of retail stores with multiple locations (e.g., fast food restaurants) would benefit from smart mouse traps. It seems cost-prohibitive to send (and pay for) technicians to visit each store and check multiple traps, while only selective traps would have caught rodents.

First, the benefit for residential customers sees marginal. Internet-connected mouse trap might appeal to squeamish consumers, who are afraid or unsure what to do, but it's hard to beat the convenience and low cost of a phone call. For our condo association, it was easy to know when a trap has caught a mouse. You heard the squeaking.

For us, the rodent removal process was easy. After a quick phone call the evening the mouse was caught, a pest-control technician arrived the next morning. The company sent a technician that was already in the area for nearby service calls. The technician removed the mouse stuck on a glue strip, checked, and re-baited several traps. That visit was included in the price we paid, and the phone call cost was negligible.

Second, the price seems expensive. The $1,600 price for a smart mouse trap equals about three years of what our condo association pays for pest control services.

Reliability and trust with smart devices are critical for consumers. A recent global study found that 44 percent of consumers are concerned about financial information theft via smart home devices, and 37 percent are concerned about identity theft.

Informed shoppers know that not all smart devices are built equally. Some have poor security features or lack software upgrades. These vulnerabilities create opportunities for bad guys to hack and infect consumers' home WiFi networks with malware to steal passwords and money, create spam, and use infected devices as part of DDoS attacks targeting businesses. (Yes, even the hosting service for this blog was targeted.) So, it is wise to understand any smart trap's software and security features before purchase.

What do you think? Are smart mouse traps worthwhile?