The idea is that information about who spent how long in which shop and when, could be valuable to retailers as marketing data. The information could even include intelligence about how long people spend standing in front of specific shop windows, and where they went afterwards.
The data could also be sold to city authorities so they can see for example, the effect of different opening hours, the firm said.
Yet although the programme, dubbed Smart Steps, which collects the data also removes all personal information apart from gender and age, it has attracted the attention of data protection commissioner for Schleswig-Holstein Thilo Weichert.
He told the Frankfurter Rundschau newspaper that the idea made him very uneasy.
“Positioning data are highly sensitive exactly because they can be used to determine where someone is,” he told the HR-Info radio station.
“It gives me stomach ache that telecommunication companies are obviously starting to distribute this information.”
O2 owner, Spanish-owned, debt-riddled, Telefonica, said this week it had set up Telefonica Dynamic Insights to sell the data.
There is no plan for how this would work in Germany as “data protection has to be 100 percent ensured,” a Telefonica spokesman told the Frankfurter Rundschau, and said it was taking advice from the German Society for Consumer Research.
Customers starting a new O2 phone contract will be asked to tick a box saying they agree to their details being used. How and whether existing customers would be asked is as of yet unclear.