FTC Testifies before Congress About Mobile Privacy

With several mobile device tracking, data collection, and app abuse issues emerging recently, it is important to know the position of one of the chief regulatory agencies in the United States. On May 10, Jessica Rich, Deputy Director of the Bureau of Consumer Protection at the U.S. Federal Trade Commission (FTC), testified before the Senate Judiciary Committee Subcommittee for Privacy, Technology and the Law about mobile device privacy.

Rich first cited some CTIA statistics: wireless penetration of 96% in the United States with 27% having smart phones. During 2010, about 62% of marketers used some form of mobile marketing for their brands.

Rich emphasized that the FTC has explored mobile and wireless issues since 2000, and hosted mobile wireless and consumer privacy workshops that explored some of the issues. As additional proof of the FTC's commitment to mobile privacy for consumers, Rich cited FTC actions against:

• Google for allegedly deceiving consumers by using information collected from Gmail users to generate and populate a new social network, Google Buzz, without users’ consent,
• Twitter for serious lapses in the company’s data security that allegedly allowed hackers to hijack accounts and to obtain access to private “tweets” and non- public data,
• Reverb Communications for alleged deceptive mobile gaming endorsements in the iTunes store,
• Philip Flora for using 32 pre-paid cell phones to over 5 million unsolicited text messages to the mobile phones of U.S. consumers.

Based upon several privacy roundtable discussions, the FTC drafted a preliminary report with privacy recommendations:

"First, staff recommends that companies should adopt a "privacy by design" approach by building privacy protections into their everyday business practices... Second, staff recommends that companies should provide simpler and more streamlined privacy choices to consumers. This means that all companies involved in data collection and sharing through mobile devices -- carriers, handset manufacturers, operating system providers, app developers, and advertisers -- should work together to provide these choices and to ensure that they are understandable and accessible on the small screen... Third, the staff proposed a number of measures that companies should take to make their data practices more transparent to consumers, including improving disclosures to consumers..."

All of this was nice a start, but the FTC's position is still weak and is heavily tilted for corporations at consumers' expense. More balance is needed.

As I read the FTC' Richs testimony (PDF), the recommendations are not mandatory but voluntary. And she skipped an important issue: that most or all tracking programs are opt-out based (e.g., where consumers are automatically included), instead of opt-in based (e.g., where consumers are in control and must opt-in or register first before companies can track them).

What do you think?

Comments

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The Federal Trade Commission (FTC) follow that was two years in the making, calling on Congress to pass data privacy legislation and on the private sector to do more to ensure the privacy of consumer data and the control that consumers have over use of that data.

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