Massachusetts has recently introduced a bill known as the Location Shield Act (H.357), which aims to safeguard the privacy of its residents by prohibiting the sale of location information derived from electronic devices, such as cell phone location data. If this bill becomes law, it will have significant implications for the location intelligence industry and site selection processes. Let's delve deeper into how the Location Shield Act is expected to impact site selection.

What Does the Location Shield Act Encompass?

The Location Shield Act lays out several requirements for corporate entities to adhere to:

• Acquiring consent from individuals before collecting or processing their location information, except in limited cases where legal obligations are involved.
• Clearly describing the permissible purposes for collecting, processing, and disclosing individuals' location information.
• Restricting the collection and processing of location information to the minimum necessary for the intended purpose.
• Deleting location information when it is no longer necessary for the intended purpose.
• Prohibiting the sale, rental, trade, or lease of location information to third parties.
• Restricting the disclosure of location information to government agencies unless a warrant or other legal authorization is obtained.
• Maintaining a Location Privacy Policy that outlines their practices concerning the collection, processing, and disclosure of location information. This policy must be easily accessible to individuals.

Violations of the law can result in fines of up to $1,000 per violation. The Location Shield Act's requirements are notably stringent, even more so than existing location privacy laws in Europe, and the penalties for non-compliance are significant. Consequently, location intelligence companies are expected to make significant adjustments to their practices to ensure compliance with the law.

What Does the Location Shield Act Mean for Location Intelligence?

Location intelligence companies often rely on location information, also referred to as mobility data, to power their products. For example, companies like Placer.ai use mobility data to analyze foot traffic and map people's movement patterns. Site selection software companies leverage mobility data to predict sales potential for prospective locations.

If mobility data becomes inaccessible due to the Location Shield Act, services like Placer.ai that measure foot traffic will cease to function effectively, and sales predictions for new locations will become less reliable. As a result, the overall quality of products in the location intelligence industry is expected to decline significantly. This development poses a significant challenge for some companies in the industry, forcing them to either find alternative methods of providing their services or face potential closure.

However, the location intelligence industry will not come to an end. Site selection analytics tools that are not heavily reliant on mobility data will continue to function effectively. Companies in the industry are likely to explore innovative approaches and alternative methods for measuring footfall and traffic density.

What Does the Location Shield Act Mean for Site Selection?

Many modern companies rely on tools powered by mobility data to inform their site selection processes. If the Location Shield Act is enacted, existing site selection tools will still work, but they will no longer receive new mobility data. Over time, the accuracy of these tools will deteriorate as communities change and evolve.

Companies that heavily depend on mobility data-powered software for site selection will need to consider incorporating other means of evaluating potential sites. This may involve relying more on traditional site selection strategies, such as manual customer counting, competitor comparisons, and intuition. Alternatively, companies may explore site selection services that do not rely on mobility data.

Regardless, all stakeholders involved in the site selection process should anticipate a significant shift in the availability and quality of data. Whether you hold the position of a real estate director, VP of operations, real estate analyst, or any other role, it is crucial to prepare for the forthcoming changes. It is recommended to wait for a week or two and then reach out to the site selection services you currently use to inquire about their plans for adapting to the evolving legal landscape.

Conclusion

Massachusetts' proposed Location Shield Act (H.357) has the potential to profoundly impact the location intelligence and site selection industries. If this bill becomes law, accessing mobility data from Massachusetts will become more challenging, resulting in a decline in the quality of services relying on such data. For professionals in the site selection business, it is advisable to begin preparing for a future where mobility data can no longer be relied upon. While Massachusetts may be the first state to introduce this legislation, it is likely that other states will follow suit in due course.