Verizon to pay $1.4M in ‘supercookie’ FCC settlement

NEW YORK — Verizon will pay a $1.35 million fine over its “supercookie” that the government said followed phone customers on the Internet without their permission. Verizon will also have to get an explicit “yes” from customers for some kinds of tracking.

The supercookies landed their name because they were hard, or near-impossible, to block. Verizon uses them to deliver targeted ads to cellphone customers. The company wants to expand its advertising and media business and bought AOL for its digital ad technology in 2015.

The Federal Communications Commission said Monday that it found that Verizon began using the supercookies with consumers in December 2012, but didn’t disclose the program until October 2014. Verizon updated its privacy policy to disclose the trackers in March 2015 and gave people an option then to opt out.

The FCC settlement says consumers now must opt in to letting Verizon share data with a third party. But for data-collection and sharing within Verizon itself, the company can choose to have customers either opt in or automatically do it and give consumers the option to stop it, a less stringent requirement.

The New York company has already changed some practices that critics considered most invasive. In an emailed statement, the company said that the FCC settlement recognizes that it had already made adjustments to its ad programs that give consumers more choices.

Nate Cardozo, a staff attorney at the Electronic Frontier Foundation, a privacy watchdog that had been critical of the supercookies, said the settlement was an “unqualified win” for consumers. “Today’s order will mean that other companies contemplating similar involuntary tracking will think twice before proceeding without explicit consumer consent,” he wrote in an email.