Facial Recognition Goes Mainstream

At CaliBurger in Pasadena, Calif., the fast-food franchise restaurant is testing out a new way for customers to pay: having their picture taken.

When they’re ready to complete their order, they step in front of a large screen at a kiosk to let a facial-recognition system snap their picture. If the system recognizes them, the payment goes through.

CaliBurger is one example of how facial recognition is beginning to make its way out of the realm of security applications—such as searching for bad guys or unlocking our phones—and into bricks-and-mortar retail and other areas of real-world commerce.

Entertainment venues want to speed customers through the gate by scanning their faces. Airlines are looking to smooth out passengers’ travel by letting them check bags and do other tasks by taking a selfie. Retailers want to send a salesperson over to help customers if a camera reads their expression and suggests they look annoyed.

But the technology faces a big hurdle: consumer concerns. Brendan Miller, a digital-business analyst with research firm Forrester, says most retailers he speaks with are still too nervous about the privacy issues associated with facial recognition and similar technology to personalize things too much yet.

“That’s why we’re very much still in beta modes, because of the concern and the creep factor around tracking,” he says. “The technology will enable it, but consumers aren’t caught up to the technology yet.”

Say cheese!

Big tech companies have been putting resources toward facial recognition for years:Facebook has long used it to suggest who should be “tagged” in photos. Amazon has sold its facial-recognition platform to law-enforcement agencies and others. Apple introduced Face ID with the iPhone X last year and in 2016 purchased a startup called Emotient that uses artificial intelligence to read people’s expressions.

Now bricks-and-mortar companies see an opportunity to take that technology and apply it in a new way—making real-world retail more effective.

One area they’re working on is personalization. Stores might use the technology for opt-in loyalty programs so that a salesperson could greet customers by name when they walk in, tell them what discounts they’re eligible for, what new products they might like based on previous purchases or speed them through checkout by letting them pay by taking their picture.

Some airlines are working on a similar plan to make travel more frictionless and convenient. NEC Corp. NIPNF 16.28% is working with carriers on a system that lets travelers check in, check their bag, access a lounge or board their flight, all with a face scan, says Raffie Beroukhim, a senior vice president.

A variation of that face-based check-in technology, also from NEC, will be used at the 2020 Tokyo Olympic Games. Athletes, employees, volunteers and the media will be able to enter venues by having their faces scanned. (NEC is also working with a unit of CaliBurger’s parent company to conduct the restaurant’s facial-recognition test.)

Another way real-world retailers want to use facial recognition is to figure out what shoppers want when the stores don’t know who they are. So, a camera and software combination would analyze people’s appearance to glean details about them—such as approximate age, gender and where they go in the store—and then use that data to entice them with special offers.

For instance, a facial-recognition system might be built into a digital display at the front of a store so that when an older man walks in, it could showcase items he might be interested in, like button-down dress shirts, as opposed to a selection of prom dresses, which might be shown to a teenage girl.

Intel INTC -1.49% is joining with retailers and software developers to offer such technology, according to Joe Jensen, vice president of the company’s IoT Group and general manager of the Retail Solutions Division.

“It’s really how physical bricks-and-mortar retailers can start to understand better what patterns of behavior shoppers have in their store, so they can bring them better offers,” says Mr. Jensen. “We’re really just trying to understand the behavior of an anonymous shopper, versus trying to figure out if it is Suzie and Suzie did A, B and C.”

But facial recognition has to deal with a major issue: privacy. In China, facial recognition is already playing out in a very intrusive way. The technology is so widespread that its uses range from providing order suggestions at KFC to catching jaywalkers to monitoring how much toilet paper people use in public bathrooms. One popular park in the capital uses face-scanning dispensers that limit each person to a two-foot length of paper every nine minutes.

Next-Level Surveillance: China Embraces Facial Recognition

Next-Level Surveillance: China Embraces Facial Recognition

Once the stuff of science fiction, facial-scanning cameras are becoming a part of daily life in China, where they’re used for marketing, surveillance and social control. Video: Paolo Bosonin. Photo: Qilai Shen/Bloomberg (Originally Published June 26, 2017)

‘Mission creep’

But the problem isn’t only a potential Big Brother monitoring us everywhere. Privacy advocates say our face prints could ultimately be tied to personal profiles that are shared among companies and data brokers.

Even potentially benign data collection has the potential for “mission creep,” says Adam Schwartz, a senior staff attorney with the Electronic Frontier Foundation, a nonprofit group focused on digital privacy. After companies collect data for a certain purpose, they do “new and unexpected things with it,” he says.

For instance, a company using biometrics to give employees access to a building could later sell that information to a broker, where it could end up being used by any number of organizations. An insurer might buy the data and use it to determine things about a person’s health and potentially deny them coverage.

“It is likely that some of the data that we have provided in the past will come to haunt us,” says Arun Ross, a professor in the department of computer science and engineering at Michigan State University. “We will discover it is providing insights into our lives that we never thought possible.”

For its part, Cali Group, the owner of CaliBurger, is still working on its privacy policy and terms of use. The company doesn’t have either yet, but Chief Executive Officer John Miller says it won’t share facial-recognition data with third parties: “We’re taking a long time to test it and think through all these issues.”

NEC’s Mr. Beroukhim says that in its airport facial-recognition system, fliers would opt in, and there would be some privacy controls.

For now, whether companies can acquire your biometric data without first asking for consent—and what kind of biometric data they’re allowed to collect—depends on where you live. The only states with some requirements for permissions are Illinois, Washington and Texas, according to Mr. Schwartz of the Electronic Frontier Foundation.

Dr. Ross says that especially following the adoption of Europe’s General Data Protection Regulation, he wouldn’t be surprised if more companies and states adopt policies to enhance privacy when it comes to biometrics.

“I think companies are becoming increasingly aware that privacy is important,” he says.

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