Taming the Wild West of Apps
Big and small app makers alike are digging for gold in mines of opportunity. But the terrain is increasingly-riddled with minefields, as regulators impose penalties to safeguard personal data and tame a gun-slinging ecosystem.
What's Happening: The FTC recommended the mobile industry take steps to safeguard personal data, and add similar "Do Not Track" features found in the PC sector. Industry players aren't required to act yet, but the strongly-worded report -- along with a decision to slap Path, a social networking app, with an $800,000 fine for violating user privacy -- underscores the seriousness of the issue.
The FTC claimed Path, which lets you write journals with photos, music and location data, engaged in deceptive practices by harvesting personal details like phone numbers, addresses and usernames for Facebook and Twitter.
What's Really Happening: As regulators gear up for the mobile age, security on phones is increasingly important. Consumers are comfortable with casual use -- like social networking and e-mail -- but they're less confident in how their sensitive data is being used.
Beyond apps, the FTC wants platforms like iOS and Android to change how they access contacts, photos and locations, among others. In addition to asking for permission, the agency wants operating systems to show an icon, telling you each time an app transmits data. It also suggested a "dashboard" that shows what apps have access to what information.
Lawmakers had formed bi-partisan efforts to pass legislation on PCs, but so far, they haven't taken steps to tackle mobile -- until now.
What's Next: Mobile use will overtake PCs later this year, and regulators are trying to enhance security on smartphones to protect you. That means tech giants like Apple and Google will need to tighten privacy and approval requirements, forcing developers to jump through increasingly stringent hoops. Path wasn't immune to scrutiny, and the scrappiest of start-ups won't be either.
"If you're outside the recommended behavior, you're at a higher risk of enforcement action," said Mary Ellen Callahan, former chief privacy officer for the Department of Homeland Security. But trade groups, who represent developers, say increased regulation will have unintended consequences that will dampen the industry. Instead of federal oversight, it suggested app makers create a system to check themselves, much like how gaming has its own rating system.
The FTC lauded existing methods, such as badges to show children's apps that collect data, but say they don't go far enough. So if you're a developer, expect stricter requirements to appease this thorny issue -- or risk being fined.
The Takeaway: You can do a lot with apps: connect with friends, set your thermostat and test your blood sugar. But now, developers must also safeguard privacy. The FTC has yet to set firm guidelines, but they are coming sooner than later. As regulation increases, the days of the Wild West will come to an end.
"Best practices will help build trust in the mobile marketplace," said Jon Leibowitz, the FTC's chairman. "It'll ensure the market can continue to thrive."
Categories: In Brief