FTC: ‘Kids’ Apps Siphon An Alarming Amount Of Information.’ Time For Freak-Out Control

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The FTC made national headlines today for a damning report on the state of privacy disclosures for kid-oriented mobile apps, warning that “kids’ apps siphon an alarming amount of information.” When I asked the FTC during a press conference to name a single example of where anyone had ever been harmed by one related to opaque data use, the response was, “kids received advertising.”

Protecting children online is a serious issue. So, as concerned parents scramble to figure out why a federal agency is making a rare appearance that has caused public alarm, we thought we would give some much-needed grounding for how worried parents should be. “We are not saying that there’s specific harm by specific apps,” the FTC admitted.

The Federal Trade Commission released a follow-up report in its ongoing public investigation on the state of data use disclosure on kids’ mobile apps: “Mobile Apps for Kids: Disclosures Still Not Making the Grade.” After surveying 400 top and randomly selected apps designed for kids, the researchers found that only 20 percent of apps disclosed privacy practices, roughly 60 percent are “transmitting” info back to app developers, and some are collecting geolocation information. Moreover, 58 percent of apps contained advertising, 22 percent contained links to social networks, and 17 percent permitted in-app purchases.

Since the first report last year, the FTC lamented that “despite many high-visibility efforts to increase transparency in the mobile marketplace, little or no progress has been made.” As a result, the FTC notified the press of “numerous nonpublic investigations,” most likely related to violations of the Children’s Online Privacy Protection Act (COPPA), which has previously resulted in large fines against developers who do not offer sufficient data-use disclosures.

To be sure, this isn’t unique to apps for kids. California Attorney General Kamala Harris threatened scores of app developers for similar privacy violations last month, and industry research finds that only 61 percent of apps conspicuously display data-use policies.

Most importantly, the FTC could not actually give a single solitary example of a harm related to any of the privacy policies. “We know for a fact that kids received advertising,” the FTC said on the press call, “which many parents don’t like.” In other words, parents can add smartphones and tablets to the list of advertising opportunities, along with highway billboards, subway trains, television, radio, most of the Internet, and the sides of many walls.

Though the FTC doesn’t highlight it, a more practical concern might be the availability of in-app purchases, which bait children into spending thousands of dollars on silly game badges and accessories (The Daily Show did a hilarious investigation into this issue last year).

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More troubling, but still unfounded, is the the availability of geolocation data. Senator Al Franken has pushed legislation that would tighten rules on cell phone tracking, which he worries can allow “bad actors” to stalk users, especially vulnerable women. As of yet, the FTC reports no related harms to children.

Children’s safety and privacy is a serious issue, but so is crying wolf. As newspapers around the country rake in traffic from exaggerated alarms, parents can breathe a sigh of relief that the skill is not falling on their app-addicted families…at least, not yet.