Consumer Reports Annual Report 2017
Letter From Our President
Marta L. Tellado
Who Holds the Reins of Power?

Some day, sooner than you may think, you will wake up in a world where the same company that delivers your groceries and 3D prints your household products also supplies your news and entertainment, where driving a car has become a quaint hobby, where everything from the walls of your home to the

shoes that you wear communicates information about you over vast networks, and where many of the most common jobs—from trucking and retail to accounting and some lawyering—will have gone the way of the milkman and the switchboard operator. It may seem improbable, but we have every reason to believe that this is exactly what the future holds for consumers.

We can’t entirely foresee the significance that these inevitable changes will hold for our lives, but we can foresee two very differents paths that lie ahead of us. Down one, the march of technology leaves privacy, fairness, and personal security in the dust. The rules necessary to protect us are left unwritten, and consumers are forced simply to trust that staggeringly complex new products and services have our best interests at heart. Down the other, the collective voices of consumers ensure that innovation is harnessed for the common good, and together we hold enough of the reins of power to drive product design, market trends, and industry standards in ways that put the needs of people first.

At Consumer Reports, we have our eyes fixed on that latter road—the bright future that, together, we all have the power to realize. We believe that new technologies can be brought to market that put consumer fairness, safety, and health first, potentially raising our quality of life in untold ways: easing financial burdens, making medical miracles a reality, bringing safety to our roads, and delivering real value, dignity, and comfort to millions. It can be easy to assume that we as individuals have no control over how the future will take shape—but we have seen time and again that this assumption is mistaken.

Together, we forged a fairer path by cracking down on predatory lending and speaking out against mergers that would have eliminated choice and raised the prices of cable, internet, and cell phone plans. We forged a safer path by insisting upon seat belts, airbags, and electronic stability control in our cars. We forged a healthier path by securing federal food safety standards and exposing the dangers of tobacco. Despite the uncertainty and complexity of the world around us, consumers still have that power today.

Making the big choice to build a better future starts with the smaller choices each of us make in the grocery store, the app store, the online market, and the auto lot. More than 80 years ago, our organization was founded on the belief that when individuals are equipped with accurate, trustworthy, independent information about the safety and performance of the products and services we need, we can use our choice and voice to bend markets in ways that reflect our shared values. Today, we apply that belief not only to ensure the safety of baby strollers and the performance of washing machines, but also to improve the transparency of student loan terms; the fairness of price-setting algorithms; the privacy of software embedded in our TVs, cars, and refrigerators; and the choices made by companies every day as they decide how to design and program products and services.

While consumers will always need to know which car seat is the safest and which dishwasher is the most effective, we now live in a world where we also need to take action based on far murkier concerns. For Consumer Reports, being a trusted partner no longer means simply being an authority on products; to truly be of service to people today, we must evolve to help them find their way in a sharing economy, adjust to a once-unimaginable level of connectivity in our daily lives, and seek out islands of trust among a sea of bots, biased information, and blurred lines around corporate-sponsored content—obstacles that breed confusion, distort markets, and obscure consumer choice.

Transforming to Meet New Challenges

In a rapidly evolving world, the work we do with and for consumers must be as transformative and groundbreaking as the new technologies that enter our lives every day, changing the way we search, trade, and purchase. This year, we began work on the first digital standard designed to evaluate connected products and services—including everything from "smart" TVs and fitness trackers to online banking and ride-sharing apps—on how responsibly they handle our privacy and data security, helping to put consumers first in the growing world of embedded software and apps. The ultimate goal of the digital standard is to put people in the driver’s seat so that they can steer clear of vulnerabilities, safeguard their rights, and make smarter choices that collectively lead to a more consumer-friendly marketplace. In a world of hacks and security breaches, the digital standard reflects a vital new approach to consumer protection that could play an enormous role in determining whether technological innovation will work for or against all of us in the years ahead.

CEO Marta L. Tellado discusses CR's evolution to meet consumers' needs in the digital age.

Because more and more of the costs of living are now entangled with hidden algorithms that make use of our personal data, we also undertook a 15-month, first-of-its-kind investigation into the secret formulas that determine car insurance rates—just one of the growing number of products and services that sets prices based in part on your personal information. Partnering with ProPublica, the nonprofit journalism organization, we pored over enormous amounts of data from drivers and insurers in California, Texas, Missouri, and Illinois, and what we found should alarm consumers in every community. The data confirms what we’ve long suspected: that disparities in prices between minority and white neighborhoods are far wider than can be explained by legitimate accident risk factors.

Of course, being a trusted partner to consumers requires more than just asserting our shared values as new market practices emerge. We must also remain vigilant to ensure that traditional markets, such as the auto industry, take safety, fairness, and transparency into account as they evolve.

This year, drivers looked to us for expertise and perspective as semi-autonomous car features began being advertised and brought to market—a new era of beta tests and remote software updates that is raising a complex set of questions. At a moment when traffic fatalities rose at an alarming rate, some automakers failed to roll out innovative features responsibly, opting for speed-to-market over safety as regulators struggled to keep pace. In the midst of this transformation, Consumer Reports was there to raise the voices of concerned families, insisting that when new technologies carry potential risks, it should be the company—not the consumer—that shoulders them.

Forcing customers to test drive new products while the kinks are still being ironed out may be perfectly harmless for some types of software, but for technology that changes the way we navigate and brake, the practice puts lives at risk. As the auto industry continues to be reshaped and reimagined in the months and years ahead, consumers must have a strong hand in the process to ensure that their lives and interests are placed where they belong: not as an afterthought for companies to consider in the wake of innovation, but as the purpose of the innovation itself.

The food and medical marketplaces have also not been spared from rising complexity, and we need to recognize and address the most pressing pain points within these areas that—perhaps more than any other—impact our day-to-day peace of mind. For the 68 percent of Americans who regularly take at least one supplement, our recent comprehensive investigation into this notoriously opaque marketplace helped shine a light on just how unreliable these products can be when it comes to health, effectiveness, and truth in advertising.

Consumer Reports investigates the supplement marketplace.

This year, we also helped consumers pass a first-of-its-kind law that requires hospitals to track and report antibiotic use and resistance data to the Centers for Disease Control and Prevention—a vital first step in reducing the estimated 23,000 deaths and two million illnesses that occur each year as a result of antibiotic-resistant infections. And because antibiotics in our food also contribute to illness and the ineffectiveness of important drugs, we scored a victory with consumers and major food providers to reduce unnecessary drug use in chicken and improve the safety of our meat.

A Time to Choose

Whether it be around food, health, automaker accountability, personal finances, data security, or anything else, the truth is that winning victories for and with consumers requires different approaches today than it did in years past. Achievements that we fought alongside consumers to secure—such as strong broadband privacy rules put in place by the Federal Communications Commission and Consumer Financial Protection Bureau rules eliminating hidden fees on prepaid credit cards—have come under threat, putting commonsense policies that boost the basic fairness and security of our day-to-day lives at risk.

We no longer have to wonder if we’re standing at a crossroads—if the moment we’re living through today represents a historic turning point for consumers. The only question is which path our society will choose to take. At Consumer Reports, we are passionate about what we do—and we know how much is at stake. Because, in the end, the work we do is about helping people: their lives, their needs, and their aspirations.

We succeed in our mission every time your family gets a little bit safer, your finances get a little more secure, your gadgets get a little more trustworthy, and your future gets a little bit brighter. In a connected world, our shared success will continue as long as you continue to let us know how we can be a better partner to you every day and at each stage of life. In the years ahead, we will continue to make our successes your successes, to elevate your voices and your choices, and to ensure that trustworthy knowledge is the bedrock upon which we, together, will forge a path to a better future and create a marketplace with fairer, safer, and healthier choices for all.

Marta L. Tellado, Ph.D.,
President & CEO of Consumer Reports