Was only going to post two but, this is important to know. Now off for a few minutes to read Jesse's post that I read about here. ***************************************************************8

Mar 26, 2001 - 11:10 AM

Report Shows How Video Recorders Watch Consumers By D. Ian Hopper Associated Press Writer

WASHINGTON (AP) - While you are watching television, your fancy new personal video recorder is telling others about your viewing habits. In a report released Monday, The Privacy Foundation says the most popular personal TV recorder, TiVo, can send back very detailed information about what programs its users watch, what they record and even which buttons they press on the remote.

The company acknowledged it has been collecting the data from its subscribers, which now number 154,000. It plans to keep collecting information about what viewers watch and record so the data can be sold to advertisers and TV networks.

But it says it no longer will collect nuts-and-bolts data such as remote usage from every user. And it says it will not link the viewer data to their name, just gather it into one big database that can only identify users by ZIP code.

Such information is valuable for targeting ad and marketing efforts and gauging the popularity of shows.

"We don't disclose personally identifiable information as a matter of policy, and we won't as a matter of policy," said TiVo chief privacy officer Matt Zinn. Added company technology officer Jim Barton: "We could modify our systems to do so, but we're not."

The Privacy Foundation, however, questions why the company needed to collect so much specific information in the first place and raises concerns whether subscriber were adequately informed.

"It looked like rocket telemetry information," Privacy Foundation technology officer Richard Smith said of TiVo's diagnostic logs. "I thought for a consumer electronic device, that whole diagnostic system is really a bit much."

The recorders work like a VCR with a hard-drive and interactive schedule that allows people to pause live television, skip commercials with a button or automatically select from a schedule which of their favorite programs to record.

TiVo is the industry leader, and a partner with AOL Time Warner. Microsoft's UltimateTV product will be on shelves soon as a rival.

TiVo also has a partnership with TV ratings company Neilsen, in which some customers are paid to give up their personal information along with their TV logs, essentially becoming "Neilsen families."

Smith, who wrote the report with David Martin, a University of Denver professor, said the manual shipped with the box was "extremely misleading," and its privacy policy out of date.

Consumers have to go to TiVo's Web site to get the latest privacy assurances. Barton said the manuals were changed starting in September 2000.

The executives also noted that since TiVo uses the open-source Linux operating system, any major modifications to its inner workings have to be made public.

That doesn't assuage Smith's fears, especially since the company posted heavy losses recently. The market leader reported a net loss of $19 million for January.

"Right off the bat, we have a trust problem here," Smith said of the company. "There's no laws around this to cover it, they're free to do whatever they choose."

But the real issue isn't what TiVo does with its data now, said David Burke, the author of "Spy TV," but whether consumers will care.

"When we have a television in our homes observing what we do and running little experiments on us, we're either going to get really mad and say that this is too much," Burke said, "or conversely, this will be the end of it. Once people have television in their homes and get used to the idea that they will be observed, the whole issue of privacy is gone."

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On the Net:

Privacy Foundation: http://www.privacyfoundation.org

TiVo: http://www.tivo.com

AP-ES-03-26-01 1110EST © Copyright 2001 Associated Press. All rights reserved.

-- Anonymous, March 26, 2001