Bankrupt RadioShack looks to sell customer data
31 Mar 2015
With electronics retail chain RadioShack going bust, techies had not only lost a favourite haunt but the company itself is looking to sell off customer data.
After filing for bankruptcy in early February, RadioShack is currently in the process of figuring out how creditors would be paid back.
Besides considering auctioning off real estate and trademarks, RadioShack is also looking to offer over 13 million e-mail addresses and 65 million customer names and physical addresses with potential information about customers shopping habits.
Though what buyers would be willing to pay for that data was not clear, the proposed sale had raised the hackles of consumer advocates who are raising potentially disturbing questions about how data about shoppers was handled.
Though the data had value for the entire online advertising industry, the question that is being asked is what would happen if a company that had amassed a huge trove of data on nearly every aspect of a person's life sold it off.
According to Marc Rotenberg, president of the Electronic Privacy Information Center, the company was a pioneer in collecting customer data, The Washington Post reported. Radio Shack was the first company that routinely asked for phone numbers and the privacy policy was critical to maintain consumer confidence, he added.
Meanwhile, Salus Capital Partners, the hedge fund trying to gain control of RadioShack, had changed its mind about raising its offer for the company.
In a letter on Sunday to the judge who would decide RadioShack's fate, Salus's lawyer Anthony Clark said that what Salus had come to know after announcing on Friday that it was working on a new and improved bid, had altered the picture.
Salus was bidding against Standard General LP, another RadioShack lender, which would determine whether RadioShack survived, and in what form.
RadioShack filed for bankruptcy on 5 February, after failing to adapt to the changing marketing scenario of the electronic goods industry.
While there was no certainty yet on what would happen to the iconic retailer, after two days of hearings in the US Bankruptcy Court in Wilmington, Delaware, RadioShack was set to return to court for more arguments over the outcome of an auction last week.
Though RadioShack named Standard General the winner, according to Salus its competing bid did not get fair consideration.
