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How Apple’s new software makes it harder for retailers to track your movements

SAN FRANCISCO, CA - JUNE 02: Attendees gather at the Apple Worldwide Developers Conference at the Moscone West center on June 2, 2014 in San Francisco, California. (Photo by Justin Sullivan/Getty Images)

Most consumers know that their shopping is being tracked online; but many don't realize how easy smartphones have made similar tracking possible in your local mall. Now, Apple has taken measures to stop the practice that lets stores track shoppers by way of a unique code generated by a phone's wireless Internet connection. Consumers will see those changes when Apple's new operating system, iOS 8, hits iPhones this fall.

Retailers have kept tabs on consumers by tracking the unique code that smartphones send out when trying to connect to wireless networks, known as a MAC address. Under Apple’s new system, the code will be randomized, making it impossible for stores to identify iPhone users in this way, though phones running other operating systems would still be trackable.

The changes were first reported by app developer Frederic Jacobs, who posted a screenshot of an official Apple slideshow on his Twitter feed that detailed the company’s plans. Other developers soon confirmed the changes; Apple declined to comment on the new feature.

Retailers have used this information to find out how often a customer visits a store, or to get an idea of how many customers pass by their storefronts. Nordstrom ended a program that tracked these codes in stores after an outcry from privacy advocates. The practice also prompted Sen. Al Franken (D-Minn.) to propose legislation that requires companies to get users’ permission to collect location data.

Franken on Monday applauded Apple for its policy change. “Apple’s decision to protect their users against this form of tracking is a smart and powerful move for privacy,” Franken said in a statement.

The move does, in some measure, protect the privacy of Apple users, and also gives more momentum to an alternative standard that Apple’s been pushing for in-store tracking. Last year, Apple introduced an iBeacon standard that relies on technology known as “Bluetooth low-energy.” The system acts as a digital tripwire in several locations throughout a store to let proprietors know when users walk by a certain point or display -- but only if they have downloaded that retailer’s app.

Retailers and policy makers have been working together to set broad standards for companies that want to use any type of location-tracking in stores. Groups including the Future of Privacy Forum and the Wireless Registry have worked together to craft codes of conduct and to provide a central place for consumers to opt-out of tracking for any connected device -- not just smartphones.

“It’s great to see Apple help people take control” of this type of data collection, said Patrick Parodi, founder and chief executive of the Wireless Registry. “This is continuing to become a big issue -- the idea of physical detection of devices, be it your car or smartphone.”