The Federal Trade Commission (“FTC”) recently released a staff report entitled, Mobile Apps for Kids: Disclosures Still Not Making the Grade, where the regulatory agency cites a lack of progress in the Mobile App industry for failing to adequately inform parents and guardians about how their child-derived information is collected, shared, and accessed. FTC Chairman, Mr. Jon Leibowitz, stated that “[w]hile we think most companies have the best intentions when it comes to protecting kids’ privacy, we haven’t seen any progress,…[i]n fact, our study shows that kids’ apps siphon an alarming amount of information from mobile devices without disclosing this fact to parents.”
While we think most companies have the best intentions when it comes to protecting kids’ privacy, we haven’t seen any progress…in fact, our study shows that kids’ apps siphon an alarming amount of information from mobile devices without disclosing this fact to parents.” – FTC, Chairman Jon Leibowitz
FTC Investigators looked for disclosures of privacy policies in three areas on App sites they visited through Apple and Google products. According to the staff report, “most apps failed to provide any information about the data collected through the app, let alone the type of data collected, the purpose of the collection, and who would obtain access to the data. Even more troubling, the results showed that many of the apps shared certain information with third parties – such as device ID, geolocation, or phone number – without disclosing that fact to parents. Further, a number of apps contained interactive features – such as advertising, the ability to make in-app purchases, and links to social media – without disclosing these features to parents prior to download.”
Highlighted findings and conclusions in the second annual report were as follows:
- Parents are not being provided with information about what data an app collects, who will have access to that data, and how it will be used. Only 20 percent of the apps staff reviewed disclosed any information about the app’s privacy practices.
- Many apps (nearly 60 percent of the apps surveyed) are transmitting information from a user’s device back to the app developer or, more commonly, to an advertising network, analytics company, or other third-party.
- A relatively small number of third parties received information from a large number of apps. This means the third parties that receive information from multiple apps could potentially develop detailed profiles of the children based on their behavior in different apps.
- Many apps contain interactive features – such as advertising, links to social media, or the ability to purchase goods within an app – without disclosing those features to parents prior to download.
- 58 percent of the apps reviewed contained advertising within the app, while only 15 percent disclosed the presence of advertising prior to download.
- 17 percent of the apps reviewed allow kids to make purchases for virtual goods within the app, with prices ranging from 99 cents to $29.99. Although both stores provided certain indicators when an app contained in-app purchasing capabilities, these indicators were not always prominent and, even if noticed, could be difficult for many parents to understand.
- 22 percent of the apps contained links to social networking services, while only nine percent disclosed that fact.