FTC fines Cox Media and partners $930,000 for deceptive 'phone spying' claims
The Federal Trade Commission has settled allegations that Cox Media, MindSift, and 110 Digital Works misled consumers about a service called Voice Data, which promised to use phone microphones for targeted advertising but delivered nothing of the sort.
The US Federal Trade Commission has imposed a combined $930,000 fine on Cox Media, MindSift, and 110 Digital Works to settle allegations of deceptive advertising practices. The regulator determined that the companies falsely marketed a service known as Voice Data, claiming it could listen to users' private conversations via phone microphones to target advertisements.
The controversy originated in 2023 when Cox Media publicly promoted the technology to potential digital marketing clients. The firm boasted that the system could ensure every casual conversation between consumers became a tool for targeting and retaining customers, explicitly comparing the capabilities to a dystopian episode of the television series Black Mirror.
Internal pitch decks published by 404 Media later corroborated these initial claims, detailing a system that allegedly functioned as a real-world version of the persistent rumour that social media companies routinely listen to users through device microphones. However, the FTC’s investigation found that the service did not listen to conversations or utilise voice data at all.
Instead, the agency found that the service consisted of reselling email lists obtained from other data brokers at a significant markup. The FTC press release further noted that the service failed to accurately place ads in customers' desired locations, compounding the misrepresentation of its capabilities.
The regulator also alleged that the companies misled consumers regarding consent, asserting that users had opted into the system when they had not. The FTC stated that even if the spying capabilities were genuine, the lack of proper consent would have constituted a violation of consumer protection laws.
The settlement confirms the findings raised by industry observers and publications such as Techdirt, which had previously highlighted the discrepancy between the marketing claims and the technical reality of the service. The fine serves as a regulatory response to the gap between the advertised surveillance capabilities and the actual data brokerage model employed by the firms.
