U.S. Federal Trade Commission Issues Second Report on Kids’ Apps and Privacy, Launches Investigations
December 10, 2012
The U.S. Federal Trade Commission (FTC) has issued a very interesting new report on kids’ apps and privacy entitled: Mobile Apps for Kids: Disclosures Still Not Making the Grade (see: here and here) (and announced new “nonpublic” related investigations in the mobile app industry). The FTC’s new report examines the privacy disclosures and practices in connection with kids’ apps in the Google Play and Apple App stores and is the FTC’s second kids’ mobile apps survey.
In announcing the release of its new report, the FTC said:
“Since FTC staff’s first survey of kids’ mobile apps in 2011, staff found little progress toward giving parents the information they need to determine what data is being collected from their children, how it is being shared, or who will have access to it. The report also finds that many of the apps surveyed included interactive features, such as connecting to social media, and sent information from the mobile device to ad networks, analytics companies, or other third parties, without disclosing these practices to parents.
While we think most companies have the best intentions when it comes protecting kids’ privacy, we haven’t seen any progress when it comes to making sure parents have the information they need to make informed choices about apps for their kids. In fact, our study shows that kids’ apps siphon an alarming amount of information from mobile devices without disclosing this fact to parents. … All of the companies in the mobile app space, especially the gatekeepers of the app stores, need to do a better job. We’ll do another survey in the future and we will expect to see improvement.”
According to the FTC, most kids’ apps it reviewed failed to disclose any information about the data being collected and commonly shared information with 3rd parties (including device ID, geolocation or phone numbers) without adequate disclosure. Some of the other key findings from the FTC’s new kids’ app report include:
1. 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.
2. Many apps (nearly 60 percent of the apps surveyed) are transmitting information from a users’ device back to the app developer or, more commonly, to an advertising network, analytics company, or other third party.
3. 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.
4. 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.
5. Fifty-eight percent of the apps reviewed contained advertising within the app, while only 15 percent disclosed the presence of advertising prior to download.
6. Twenty-two percent of the apps contained links to social networking services, while only nine percent disclosed that fact.
7. Seventeen 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.
Recommendations made in the FTC’s report include for mobile app industry members to accelerate efforts to disclose key information, incorporate privacy protections in the design of mobile products and services, offer consumers easy-to-understand choices about data collection (and sharing information through kids’ apps) and provide increased transparency about how data is collected, used and shared through kids’ apps.
The FTC has also announced that it is launching “multiple nonpublic investigations to determine whether certain entities in the mobile app marketplace have violated the Children’s Online Privacy Protection Act … or engaged in unfair or deceptive trade practices in violation of the FTC Act.”
For a copy of the report see: Mobile Apps for Kids: Disclosures Still Not Making the Grade.
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