LUCA: Telefónica’s shady side hustle

While Tech Behemoths are under constant scrutiny for their data practices, there’s another industry which has been silently gathering gigabytes of customer behavior logs for years. Telecommunication companies, and in particular cellphone carriers, can easily monitor users’ activity 24/7 and monetize this information.

Much has been said about the influence that Social Networks and Big Tech companies have in our lives, and the general population is already aware of the volume of personal information that these corporations collect, analyze, and monetize. In January 2020, the movie The Social Dilemma popularized the concept of Surveillance Capitalism and raised awareness about Social Networks’ data collection practices. Later that year, Facebook, Amazon, Apple, and Google CEOs had to testify before Congress, where they were questioned about the use they make of their customers’ data, among other accusations.

While Tech Behemoths are under constant scrutiny for their data practices, there’s another industry which has been silently gathering gigabytes of customer behavior logs for years, and has more recently started digging into it, and generating valuable insights for the private and public sectors. Telecommunication companies, and in particular cellphone carriers, can easily monitor users’ activity 24/7. The combination of real-time precise geolocation with detailed navigation activity enables an accurate profiling of individuals that, once anonymized and aggregated, reveals patterns.

Although some exploratory projects had already been running since 2011, LUCA was formally created in 2016 as a division of Telefónica, one of the world’s most important telecommunication companies. As the biggest industry player in Europe, and with an extensive footprint in Latin America, Telefónica provides “quadruple-play” bundles, including landline phones, cable television, broadband internet, and mobile communications.

LUCA is the Big Data and AI business unit of the company. They specialize in generating insights for the Retail, Banking, Tourism, and Transport industries, among others, by leveraging their invaluable access to historic activity logs from 350 million customers worldwide, generating over 1 billion new datapoints every day. With presence in more than 20 countries, LUCA has already delivered over 200 projects for more than 150 corporate clients. They have also expanded their geographic reach by establishing joint ventures with Unicom in China and Telephone in Israel.

Crowd Analytics products

  • LUCA Smart Steps: Through analyzing the behavior of specific population segments, LUCA helps organizations to better understand their target customers.
    Their “Store” product is designed for retailers, banks, and grocery stores. Through Out of Store and In Store analyses, it can help find the ideal retail location based on target customer’s traffic, measure the impact of specific marketing campaigns, or identifying who the visitors are and where they come from.
    Their “Audience” is intended for marketing and media agencies and enables a micro-geographic and micro-temporal advanced segmentations of audiences. It helps advertisers find the optimal placement for their campaigns based on sociodemographic and behavioral variables, and it provides an estimate of how many individuals within a specific profile will be exposed to the message.
  • LUCA Tourism: Targeted at local governments, tour operators, big venues, and events sponsors, the Smart Tourism platform provides valuable insights for planning touristic projects and assessing their financial potential. The tool can estimate the volume and origin of tourists throughout the year, discern between same-day and overnight visitors, identify recurrent travelers, and help design public services by understanding the tourists’ behavior patterns and favorite attractions in the area.
  • LUCA Transit: Designed specifically for Transportation Departments, highway operators, and public transport services, LUCA Transit analyses millions of trips per day in order to decode urban mobility patterns in big cities. It helps to optimize the design routes and plan schedules for public transport, estimate the demand and profitability of transport services, analyze the traffic between specific urban centers, and define pricing strategies and marketing campaigns based on the profile of routes’ users.
LUCA platforms
LUCA Store, Audience, Transit, and Tourism solutions

Beyond commercial audiences

The first and foremost concern when working with sensitive personal data is definitely security. For that reason, LUCA shares its CTO with ElevenPaths, Telefónica’s Cyber Security team. Information is always analyzed in an anonymized way, and results are aggregated in order to protect privacy.

LUCA must also make sure that they make a responsible use of their customers’ data, preventing potential reputational risks. Therefore, they have launched several Data for Good initiatives. Their Data Transparency Lab brings together a community of technologists, researchers, policy makers and industry leaders to guarantee data transparency through research, innovation, and design.

Other Data for Good projects include partnering with NGOs and providing help to a broad range of organizations leveraging technology, data, and AI. Examples range from using mobile phone activity for disaster management during floods in collaboration with UNICEF, to working with the WHO in developing predictive models for the diffusion of diseases based on mobility patterns, among many others.

While LUCA continues supporting governments in the fight against COVID, the business continues to consolidate. Telefónica has recently announced its own voice assistant called Aura, and the launch of their Living Apps, allowing corporate partners and advertisers to now communicate with users directly in their living rooms, displaying content on their TV screens, showing up on their Voice devices, or even managing their smart lighting to create a specific mood.

 

Sources

Big Data | Movistar. (n.d.). Movistar Big Data. https://www.movistar.co/web/corporaciones/big-data

LUCA – AI powered decisions. (2021). LUCA. https://luca-d3.com/

LUCA – Think Big Empresas. (n.d.). Think Big. https://empresas.blogthinkbig.com/luca/

LUCA, Telefonica Data Unit | Press Office. (n.d.). LUCA, Telefonica. https://www.telefonica.com/en/web/press-office/-/luca-telefonica-data-unit-positioned-as-a-leader-among-specialized-insights-service-providers

Robuck, M. (2018, October 10). Telefónica’s Luca division is driving AI into big data solutions for customers. FierceTelecom. https://www.fiercetelecom.com/telecom/telefonica-s-luca-division-driving-ai-into-big-data-solutions-for-customers

Telefonica, LUCA, & Benjamins, R. (2019, March). How network data and AI are enabling new digital business models and services. https://www.futurenetworld.net/wp-content/uploads/2019/03/1.4-Richard-Benjamins.pdf

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