Sen. Al Franken probes Oculus over data collection policy

He wrote a letter to the company asking if data is sold to third parties, and how long it's stored

Editor's Note: Our annual Vator Splash Spring 2016 conference is around the corner on May 12, 2016 atthe historic Scottish Rite Center in Oakland. Speakers include Nigel Eccles (CEO & Co-founder,FanDuel), Andy Dunn (Founder & CEO, Bonobos), Mitch Kapor (Founder, Kapor Center for SocialImpact); Founders of NextDoor, Handy, TubeMogul; Investors from Khosla Ventures, Javelin VenturePartners, Kapor Capital, Greylock, DFJ, IDG, IVP and more. Join us! REGISTER HERE.

If the numbers are correct, there will be a lot of people buying virtual reality headsets, a fair number ofwhich will Oculus devices.

There's a catch, though: it will be collecting your data. It says so explicitly in its privacy policy. And now the government is starting to probe into what exactly it will be doing with that information once it has it.

Senator Al Franken from Minnesota sent to a letter to Brendan Iribe, co-founder and CEO of Oculus, asking him to clarify how the company is going to use the data it collects. 

"I am writing to request information on Oculus' virtual reality technology, called Rift, and the company's collection, storage, and sharing of users' personal data. Oculus' creation of an immersive virtual reality experience is an exciting development, but it remains important to understand the extent to which Oculus may be collecting Americans personal information, including sensitive location data, and sharing that information with third parties," Franken wrote.

In the privacy policy Oculus says that it collects name, email address, phone number, and date of birth when a user registers to use its service. In addition, if a person buys something on or through the company, Oculus will collect information about the transaction, which can include payment information,purchase activity, and shipping and contact details.

Also when a user posts, shares or communicates with other Oculus, those will also be stored.

Franken seems to take issue, though, is the location information that Oculus collects from the device's IP address. If the user is on a mobile device, Oculus says it "may collect information about the device's precise location, which is derived from sources such as the device's GPS signal and information about nearby WiFi networks and cell towers."

"I believe Americans have a fundamental right to privacy, and that right includes an individuals access to information about what data are being collected about them, how the data are being treated, and with whom the data are being shared. As virtual reality technology evolves, I ask that you provide more information on Rift and how Oculus is addressing issues of privacy and security," wrote Franken. 

Oculus does also include how is uses the information it gathers.

That includes to enable user-to-user communications, to allow users to communicate with Oculus, to provide technical support and to give users updates.

In addition, though, it also says it may use the information to market to users, meaning it will likely use the location data to send ads to users for nearby stores and deals. It also says that it "may share information within the family of related companies that are legally part of the same group of companies that Oculus is part of, or that become part of that group, such as Facebook."

While Franken said he appreciated that Oculus gave this information he still has questions he wants answered. They include: does Oculus share user information with any third parties? How long does Oculus keep the data it collects? And how is Oculus going to make sure that that data is not exposed in a security breach? 

He requested that Oculus respond to the inquiry by May 13.  VatorNews reached out to Oculus for a comment on Senator Franken's letter, and to see how the company plans to respond, but no one could be reached at this time. We will update this story if we learn more. 

In all, revenue from virtual reality headsets will reach almost $1 billion this year, hitting $895 million, with a total of the 12.8 million devices that will be sold.

A huge amount of that revenue, 77 percent of it, is going to come from the high end market, specifically from Oculus, as well as HTC and Sony.  However the vast majority of the devices that will be sold are going to be on the lower end of the price scale. Only 13 percent, or 1.7 million, will be from those premium devices. 

The differentiating factor will be the price; the newly released Oculus Rift goes for $600. 

(Image source: dailykos.com)