AT&T debuted its ultra-high-speed Internet service in Kansas City, Missouri on Tuesday. Customers in the area can now subscribe to AT&T's 1 Gigabit per second (Gbps) GigaPower service in exchange for $70 and their privacy.
In a clever piece of marketing, AT&T says customers can avail of the $70 Internet Preferences package as a discounted "premier" offer if they want to pay a smaller price. The "standard" package, AT&T says, costs $99, making customers pay an additional $29 to keep their privacy. In contrast, Google, which does not charge customers of its Google Fiber 1 Gbps fiber optic Internet service to keep their browsing habits private, charges $70 for the standard package.
AT&T says it collects information about the websites its customers visit, how much time they spend on each website, what links they click, and the things they search for in the search engines. The ISP also says its Internet tracking platform works even if customers enable the do-not-track and privacy options on their browsers, use an ad blocker, or clear their cache.
AT&T then uses the information it gathers through tracking to deliver targeted advertisements to customers based on what they have been looking at online. For instance, if a customer searches for concert tickets, they may receive ads for restaurants surrounding the concern venue. Or if he looks up hotels in Miami, the email address she signed up with AT&T may receive emails about Miami rental cars.
The only thing that AT&T does not get into are websites with HTTPS or encrypted websites, such as online shopping pages for entering credit card information and banking websites.
Computer scientist Jonathan Mayer of Stanford University says AT&T's additional charge to protect privacy is worrisome and seems like "a huge penalty intended to normalize the practice" of tracking customers' browsing habits, given that AT&T is in a position to perform comprehensive tracking. But AT&T defends its position, saying that allowing advertisers to send targeted ads to its customers pays for the extra charge customers would have to pay if they opted for the "standard" service.
"We can offer a lower price to customers participating in AT&T Internet Preferences because advertisers will pay us for the opportunity to deliver relevant advertising and offers tailored to our customer's interest," an AT&T spokesperson tells the Wall Street Journal.
AT&T also says its offer is similar to how Amazon sells its Kindle e-readers, which are offered at a lower price if the buyer chooses a Kindle with advertising. The major difference, however, is Amazon does not collect the reading habits of their customers. Instead, Kindle shows random ads that do not have anything to do with what customers have been reading.
Marc Rotenberg, president and executive director of the Electronic Privacy Information Center in Washington says loopholes in communication regulation allow AT&T and other ISPs to get around the law.