With more and more companies engaging in the field of analytics, companies continue to come up with new and innovative ways to harvest their fields of Big Data. For instance, on Tuesday, the New York Times reported on how a range of start-ups and established tech companies are focusing their analytics efforts on a technology for mobile apps referred to as “predictive search.” The technology would not require people to enter a search query; instead, relevant information is pushed forward to the users proactively based on their location, time of day, digital activity (such as their email and calendar), and other contextual factors. For example, a phone with predictive search could inform users – before they even ask for it – what time they need to leave for their meeting based on their location, nearby traffic and calendar entries.

Predictive search is an innovative development in analytics, capitalizing on the wealth of information mobile phones store on their users. Variations in the technology are also starting to pop up. As technology continues to push forward, companies need to stay mindful of the risks in this area. For instance, companies need to ensure that they fully understand the types of data they’re collecting, how and why they’re combining it with other data sets, the methods they’re employing to collect the data, and that the disclosures they provide to consumers correspond with their actual practices. Failing to accurately provide such disclosures may result in class action litigation or regulatory enforcement. In fact, just last week, a New York-based analytics and advertising company agreed to a $1 million settlement with the New Jersey attorney general for the unauthorized use of cookies in connection with offering their analytics-based advertising syndication service.

According to the consent decree, the company operated a consumer analytics and advertising exchange in which it entered into agreements with publishers to sell ad space on their sites, while also contracting with advertisers to place targeted ads on the publishers’ sites. The company employed a JavaScript code to place cookies on the Safari browsers of consumers even if they had set their privacy settings not to accept such cookies. The cookies were used in part by the ad buyers to identify other cookies they used, so that they could synchronize their data-collection efforts on the ad network. The placement of the cookies conflicted with the company’s privacy policy, which said that consumers could configure their web browsers to reject all cookies. [Side note: Last year, the state of New Jersey also brought charges against a California app developer for its alleged violations of the Children’s Online Privacy Protection Act. You can see our previous coverage of that case here.]

The benefits to analytics are obvious, evidenced by the increasing number of companies offering innovative services like predictive search. Companies should still keep the legal risks in mind when moving forward.