Gary Shapiro, president and CEO of Consumer Technology Association (CTA)™, recently commented on the balance of industry and consumer benefits of the government’s decision to abandon their case against Apple, and he highlights the challenges facing the reverse logistics industry. In the process of reviewing this difficult subject, parties on both sides have acknowledged the potential benefits of retrieving data from the encrypted devices, but the risk for consumers’ personal devices is challenging if such a mechanism for retrieving data were to be created by Apple.
One overlooked risk to consumers in this discussion is the massive impact such a data retrieval tool could have on the mobile device reverse logistics industry. The industry processes tens of millions of devices annually, whether from trade-ups, trade-ins, or insurance returns. Since the introduction of the smartphone products, the reverse logistics industry has struggled to develop tools that effectively eradicate data from mobile devices. Mobile devices represent a unique challenge in that, unlike PCs and laptops, a complete data overwrite of the entire device is not possible for recovered devices as this would also erase the device’s operating system. As smart devices have become more advanced, this problem not only has become more complicated but so has the risk to consumers if data is not successfully eradicated.
The introduction of default encryption on Apple devices has gone a long way to mitigate the risk for consumers from data escapes on these devices. Reverse logistics processors can leverage the data encryption as the starting point for eliminating access to data stored on the device. Thus, devices reintroduced in the primary market after processing in the reverse logistics channel represent no risk to consumers whether they are redistributed in the United States or the many markets with high demand for these devices around the world. The question that should be asked as mechanisms to defeat the encryption as a data protection tool are discussed remains: Is the consumer’s data still safe? This is not an insignificant question given the tens of millions of devices and therefore 100 of millions of consumers that may be impacted.