FTC staff report provides recommendations on improving privacy, data disclosures to consumers

150px-US-FederalTradeCommission-Seal.svgThe FTC recently released a staff report that provides recommendations on how mobile platforms, application developers, advertising networks, analytics companies and app developer trade associations can provide better data and privacy disclosures to consumers.

“The mobile world is expanding and innovating at breathtaking speed, allowing consumers to do things that would have been hard to imagine only a few years ago,” FTC Chairman Jon Leibowitz said. “These best practices will help to safeguard consumer privacy and build trust in the mobile marketplace, ensuring that the market can continue to thrive.”

The mobile services industry enjoyed considerable and rapid growth. In the fourth quarter of 2012, consumers around the world purchased 217 million smartphones. Mobile payments also increased significantly over the past few years. The growth of the industries, however, raised some concerns about privacy and corporate use of personal data.

Mobile devices are usually a personal device, always powered on and always with the user, that can enable data collection on a massive scale and the sharing of information with other entities and parties. Consumers have become increasingly concerned about their privacy and personal information on mobile devices. The report revealed that 57 percent of all mobile app users either uninstalled an app or declined to install an app, citing privacy concerns. Fewer than one-third of American consumers indicated that they felt control over their personal information on mobile devices.

The report recommended that mobile marketplace participants provide detailed disclosures and obtain consent before allowing apps to access personal information, allow consumers to review the content types accessible by installed apps and consider the development of icons to indicate when data is being shared. The app should also be accompanied by an easily accessible privacy policy and app developers should consider participation in self-regulatory groups, while advertising networks should work with app developers to provide truthful disclosures to consumers.

“FTC staff strongly encourages companies in the mobile ecosystem to work expeditiously to implement the recommendations in this report,” the report said. “Doing so likely will result in enhancing the consumer trust that is so vital to companies operating in the mobile environment.  Moving forward, as the mobile landscape evolves, the FTC will continue to closely monitor developments in this space and consider additional ways it can help businesses effectively provide privacy information to consumers.”

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