California car data bill has manufacturers, insurers butting heads
03/18/2014 8:01 PM
03/19/2014 7:47 AM
Foreshadowing a clash between carmakers and a prominent auto insurance company, Sen. Bill Monning on Tuesday unveiled a bill to loosen car manufacturers’ grip on data generated by vehicles.
Framed by a computer-equipped car parked on the steps of the state Capitol, the Carmel Democrat said his Senate Bill 994 would allow consumers to see what data their car emits and decide with whom they want to share the information. The measure is sponsored by AAA Northern California and its south state counterpart, the Automobile Club of Southern California.
“Californians are entering a new era of car-buying where vehicles have now become the ultimate mobile computing devices,” Monning said. “It is your car,” he added, “it is your data, and it should be your choice.”
Cars have evolved beyond simple conveyances of steel and rubber into sophisticated data transmitters, capturing driver statistics that can include where and how fast a person drives, the number of passengers in a car and the road tunes a driver is playing.
One car in five sold this year can disseminate such information and connect with personal devices like smartphones, Monning said, and estimates suggest all new cars will have the capability by 2025.
“As the cars become more and more sophisticated, there’s more and more layers of technology,” Monning said, “some of which might be accessible by repair service and some of which aren’t.”
Currently, car manufacturers are the near-exclusive keepers of much of the data cars create. Backers of Monning’s bill say automakers use that information to point cars in need of repair toward affiliated dealers.
The legislation seeks to break that monopoly. In addition to knowing what information is emanating from their cars, drivers would be able to decide if they want to share car data with, for instance, a mechanic.
“If I have a car problem, a red light on the dashboard, I want to be able to take that to a repair service that, with my authority, they could access that data to make a repair,” Monning said.
The legislation has already prompted a public relations counteroffensive from automakers, who call the bill an insurance industry ploy to gain access to lucrative consumer information that could be resold or leveraged to raise insurance rates.
“Cynically masquerading on behalf of consumers, the state’s largest insurance company has concocted SB 994 to advance its commercial objective to exploit consumer data for profit,” Alliance of Automobile Manufacturers CEO Mitch Bainwol said in a written statement.
In response to those concerns, Monning said his bill preserves a segment of California law that prohibits insurers from using data other than mileage to set rates. Law enforcement could still obtain car data if they went through the necessary legal process and obtained a court order.
If a consumer enables another company to see his or her car data, that company could conceivably pass the data along to someone else – but only, Monning said, if the consumer signs off.
“I would expect in that conversation and in that contract, I’d want to make sure they’re not going to share it with anyone else,” Monning said.
And while automakers’ surrogates are already warning about how newly designated recipients of car data might use the information, that critique can be deflected back to car manufacturers. Consumer advocates say drivers have little insight into how manufacturers use the data they collect from computerized cars.
“We don’t know what they’re doing with it,” said John M. Simpson, director of Consumer Watchdog’s privacy project.
The agreement a car buyer signs clearly establishes how any data would be used, said Rob Stutzman, a consultant who is working for the Alliance of Automobile Manufacturers on the bill.
“There’s nothing that’s done with it that isn’t consented to by the consumer at time of lease and purchase,” Stutzman said, adding that a manufacturer could pass data along to a third party only “when it’s been contractually consented to.”
Sending more driver information into the world would erode data security, Stutzman said. In a world where cars are increasingly interconnected, giving third parties access to reams of car-generated information would undermine privacy protections.
“Privacy is an issue and how the data handled is an issue, but this bill would completely obliterate any process moving forward to make sure you have protected data,” Stutzman said. Monning’s bill, he added, “would almost make it impossible to tightly protect this data, including the conditions of how it can be used.”
In contrast to that portent, Monning cast his bill as a precautionary measure. He said he wants safeguards that anticipate the kind of emerging technologies that will undergird the cars and roads of the future.
“We think we’re on the frontier of trying to get ahead of the technology revolution on this,” Monning said of his bill, pointing to “the greater potential of sharing information.”
Already, California and other states are examining how cars that can talk to one another could ease traffic congestion and prevent accidents by blunting driver error. The U.S. Department of Transportation has an initiative looking at vehicle-to-vehicle communication, and California is contemplating regulations around autonomous, self-driving cars.
“The privacy aspect is a huge piece of this,” said Bernard Soriano, a deputy director at the California Department of Motor Vehicles overseeing the driverless car regulation. “These vehicles have the potential to be collecting data about the route, about the roads, about the driver, so we have all these questions: Who owns the data? Where is it stored? Who has access to the data?”
More car information could help people understand and adjust their own driving habits, advocates say. One of the speakers at Monning’s conference represented a San Francisco-based company named Automatic, which sells a device that plugs into a car’s diagnostics port and extracts a limited amount of driving data.
“We can help consumers be better aware of how they drive, how much gas you’re using, change your driving habits if you like to save gas, be safer,” said Chuck Wallace, head of business and operations for Automatic.
For repair shops, the more immediate goal is getting information that would help to fix cars that have become more complex.
“This is a roving computer,” said Bud Rice, who owns a network of auto repair shops and is secretary of the California Automotive Business Coalition. “It’s got a bunch of sensors and different pieces of equipment that you’ve got to know what it takes in order to make a diagnosis and replace it.”
While there are multiple uses for car data, Simpson said the bill must rigorously control when the data can be shared.
“What’s happened so often is new technologies have been developed and privacy protections haven’t caught up,” said Simpson. “It’s important those limits (in Monning’s bill) are really meaningful and strong and you get good control by the owner of the car.”
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