Groupon data collection scrutinized by Congress

SAN FRANCISCO (Reuters) - Groupon Inc's privacy and data-collection policies came under congressional scrutiny on Thursday, the latest sign of regulatory pressure on the largest online daily deals company.

Representatives Joe Barton (R-Texas) and Edward Markey (D-Mass.), co-chairmen of the House Bi-Partisan Privacy Caucus, said they sent a letter on Thursday to Groupon Chief Executive Andrew Mason asking about the company's new privacy and data collection policy.

Groupon unveiled new policies earlier this month in an email to its more than 80 million subscribers.

The company said it collects subscribers' contact details and information on their Groupon transactions, financial accounts, location and relationships.

Groupon shares that data with merchants in some instances, such as when subscribers buy or redeem a Groupon coupon with those merchants. The data also is sometimes sent to "business partners or advertisers" as part of an offer or other activity involving Groupon, according to the policy.

Groupon also said it uses cookies and other technology to help it track subscribers' online activities.

Data like this is seen as crucial to the success of Groupon and other daily deal companies. As they collect more information about customers, these companies will be able to offer more appropriate bargains, increasing the chances subscribers will buy them.

However, this strategy is increasing concern about privacy.

"Groupon has made it clear that they are expanding their business model by collecting more personal information and even tracking your location," Rep. Barton said in a statement.