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Question 46 - CIPP-E discussion

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SCENARIO

Please use the following to answer the next question:

You have just been hired by a toy manufacturer based in Hong Kong. The company sells a broad range of dolls, action figures and plush toys that can be found internationally in a wide variety of retail stores. Although the manufacturer has no offices outside Hong Kong and in fact does not employ any staff outside Hong Kong, it has entered into a number of local distribution contracts. The toys produced by the company can be found in all popular toy stores throughout Europe, the United States and Asia. A large portion of the company's revenue is due to international sales.

The company now wishes to launch a new range of connected toys, ones that can talk and interact with children. The CEO of the company is touting these toys as the next big thing, due to the increased possibilities offered: The figures can answer children's Questions: on various subjects, such as mathematical calculations or the weather. Each figure is equipped with a microphone and speaker and can connect to any smartphone or tablet via Bluetooth. Any mobile device within a 10-meter radius can connect to the toys via Bluetooth as well. The figures can also be associated with other figures (from the same manufacturer) and interact with each other for an enhanced play experience.

When a child asks the toy a question, the request is sent to the cloud for analysis, and the answer is generated on cloud servers and sent back to the figure. The answer is given through the figure's integrated speakers, making it appear as though that the toy is actually responding to the child's question. The packaging of the toy does not provide technical details on how this works, nor does it mention that this feature requires an internet connection. The necessary data processing for this has been outsourced to a data center located in South Africa. However, your company has not yet revised its consumer-facing privacy policy to indicate this.

In parallel, the company is planning to introduce a new range of game systems through which consumers can play the characters they acquire in the course of playing the game. The system will come bundled with a portal that includes a Near-Field Communications (NFC) reader. This device will read an RFID tag in the action figure, making the figure come to life onscreen. Each character has its own stock features and abilities, but it is also possible to earn additional ones by accomplishing game goals. The only information stored in the tag relates to the figures' abilities. It is easy to switch characters during the game, and it is possible to bring the figure to locations outside of the home and have the character's abilities remain intact.

What presents the BIGGEST potential privacy issue with the company's practices?

A.

The NFC portal can read any data stored in the action figures

Answers
A.

The NFC portal can read any data stored in the action figures

B.

The information about the data processing involved has not been specified

Answers
B.

The information about the data processing involved has not been specified

C.

The cloud service provider is in a country that has not been deemed adequate

Answers
C.

The cloud service provider is in a country that has not been deemed adequate

D.

The RFID tag in the action figures has the potential for misuse because of the toy's evolving capabilities

Answers
D.

The RFID tag in the action figures has the potential for misuse because of the toy's evolving capabilities

Suggested answer: B

Explanation:

While all of the options present potential privacy issues, the lack of transparency about data processing poses the biggest risk for several reasons:

Uninformed Consent:Without clear information about data collection and usage,children and parents cannot make informed decisions about using the toys.This violates the principle ofinformed consent,which is a cornerstone of data protection laws.

Hidden Features:The packaging and privacy policy do not disclose the hidden functionality of the toys,including the connection to the cloud and data processing in South Africa.This lack of transparency creates distrust and raises concerns about potential misuse of data.

Unclear Data Flow:The explanation provided about the data flow is vague and incomplete.It is unclear what data is collected,how it is stored,for what purposes it is used,and who has access to it.This lack of clarity creates uncertainty and raises concerns about potential data breaches or leaks.

Limited Control:Without detailed information about data practices,users have limited control over their information.They cannot opt out of data collection or request deletion of their data,further hindering their privacy rights.

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asked 22/11/2024
Carlos Roberto
52 questions
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