TomTom admits selling drivers' data
Europe's largest satellite navigation maker has apologised to customers for selling their data, which was then used by Dutch police to set speed traps.
Dutch newspaper Algemeen Dagblad reported that police had obtained the information from the government and used it to set targeted speed traps, prompting angry reactions from TomTom users.
In an apology, chief executive Harold Goddijn said the company sold the anonymous data believing it would be used to improve safety or relieve traffic bottlenecks. "We never foresaw this kind of use and many of our clients are not happy about it," he wrote.
He went on: "Customers come first at TomTom. When you use one of our products we ask for your permission to collect travel time information on an anonymous basis. The vast majority of you do indeed grant us that permission. When you connect your TomTom to a computer we aggregate this information and use it for a variety of applications, most importantly to create high quality traffic information and to route you around traffic jams.
"We also make this information available to local governments and authorities. It helps them to better understand where congestion takes place, where to build new roads and how to make roads safer. We are actively promoting the use of this information because we believe we can help make roads safer and less congested.
"We are now aware that the police have used traffic information that you have helped to create to place speed cameras at dangerous locations where the average speed is higher than the legally allowed speed limit. We are aware a lot of our customers do not like the idea and we will look at if we should allow this type of usage. This is what we really do with the data: We ask for your permission to collect historical data. You can opt in or opt out and can disable the data collection function at any time.
"If you are using a LIVE device, you receive traffic information in real time and you automatically contribute to generating traffic information. We make all traffic data anonymous. We can never trace it back to you or your device." He promised licensing agreements would "prevent this type of use in the future".
TomTom reported first quarter net profit of 11 million euro (£9.6 million), up from three million euro in the same period a year earlier. It also reported worse-than-expected sales of 265 million euro, a 1% decline. The company cut its minimum full year sales target from 1.52 billion to 1.425 billion euro. It said it now expected the market for personal navigation devices to shrink by at least 15% this year amid poor consumer demand and competition from substitutes such as tablet computers and smartphones.
It said it had won market share from major direct rival Garmin in the first quarter. TomTom is seeking to diversify its offerings away from the ailing market for its flagship product, dashboard-mounted sat-nav devices. Around half of its revenues now come from car makers who incorporate TomTom products into their vehicles and from services, including companies - and governments - paying for map and traffic information.
TomTom is still recovering after it got into debt trouble with its acquisition of digital map maker Tele Atlas in 2008, and had to issue shares to stave off bankruptcy.