July 21, 2011, 4:16 PM

Groupon faces Congressional questions over its new privacy policy

Reps. Ed Markey and Joe Barton want to know more about Groupon’s mobile tracking.

Zak Stambor

Managing Editor

Lead Photo

Reps. Ed Markey (D-Mass.) and Joe Barton (R-Texas) today sent a written inquiry to Groupon Inc. seeking information about the company’s privacy practices.

Groupon recently revised its privacy policies to allow the company to track mobile consumers’ locations even when their Groupon apps are closed. The policy changes come as the daily deal leader continues to expand the breadth of its Groupon Now tool, which uses geolocation technology to offer deals to consumers based on their present locations.

“If you use a Groupon mobile application and your mobile device’s settings allow it, we may collect mobile location information from your device. Our application may be designed to collect information even if you are not logged into the Groupon application,” reads the policy.

Groupon’s policy also says it shares information with merchants that offer deals to enable them to communicate with, and advertise to, consumers.

The congressmen want Groupon to explain how it will gather location information when a consumer is not logged into the application, whether its mobile data collection practices are consistent across devices and whether the company gives consumers an opportunity to opt in to allow the company to access their locations.

The congressmen, who are co-chairs of the bipartisan Congressional Privacy Caucus, also seek more detail about how and why Groupon will collect and use consumers’ information. For instance, “Groupon indicated that it omitted a section in its previous privacy policy discussing children’s information because its web site is not geared toward children,” the letter reads. “What mechanisms does Groupon have in place to identify the age of its consumers?”

The letter states that the congressmen want responses to the questions by Aug. 10.

A Groupon spokesman says that the company has received the written inquiry and that the daily deal provider looks forward to explaining its business model and privacy policies to the congressmen.

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