A hot potato: For almost as long as we've had smartphones, there has been the belief that they surreptitiously listen to our spoken conversations to serve us targeted ads; most people have experienced seeing an ad on Facebook for something they were recently talking about. It's always been claimed that this type of privacy invasion doesn't happen. However, a marketing agency, whose clients included Facebook and Google, has admitted to using an "Active Listening" feature that eavesdrops on conversations via phone mics to gather data.

A pitch deck from Cox Media Group (CMG), seen by 404 Media, states that the marketing firm uses its AI-powered Active Listening software to capture real-time data by listening to phone users' conversations. The slide adds that advertising clients can pair the gathered voice data with behavioral data to target in-market consumers.

The deck notes that consumers "leave a data trail based on their conversations and online behavior" and that Active Listening collects and analyzes behavioral and voice data from 470+ sources.

It's also revealed that CMG's clients include Facebook, Google, and Amazon, though it doesn't specify if they used the Active Listening tool.

When 404 Media reached out to Google for comment about its relationship with CMG, the search giant removed the group from its Partners Program site, suggesting it no longer works with the agency.

"All advertisers must comply with all applicable laws and regulations as well as our Google Ads policies, and when we identify ads or advertisers that violate these policies, we will take appropriate action," a Google spokesperson told The New York Post.

Meta, meanwhile, says it will investigate CMG to see if the agency violated any of its terms of service. "Meta does not use your phone's microphone for ads and we've been public about this for years," a Meta spokesperson said. "We are reaching out to CMG to get them to clarify that their program is not based on Meta data."

Amazon said it has never worked with CMG on the program and has no plans to do so. The tech giant said it would take legal action against any partner that violates its terms of service.

Cox acknowledged the legal implications of its Active Listening tech in a now-deleted (but archived) blog post from November 2023. "We know what you're thinking. Is this even legal?" it asks.

The agency claims that it is legal for phones and devices to listen to users. Cox says this is made possible by including consent to use Active Listening in the multi-page terms of use agreements – which few people ever read – that appear with new app downloads or updates.

404 Media first reported on CMG's Active Listening tech in December.

Back in 2017, Facebook's then-president of ads, Rob Goldman, said the platform doesn't and has never used phone microphones to serve ads. CEO Mark Zuckerberg had to repeat the denial to Congress a year later, while he was answering questions about the Cambridge Analytica scandal and Russian election interference.

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Facebook partner admits to eavesdropping on conversations via phone mics for ad targeting