FTC to Investigate Violations of Current Children’s Online Privacy Laws

Brad Friedman President, The Friedman Group, LLC

Posted on January 3rd 2013

FTC to Investigate Violations of Current Children’s Online Privacy Laws

The Federal Trade Commission (FTC) recently gave a “Two Thumbs Down” to mobile apps for children in terms of privacy, according to the release of their most recent report on the issue Mobile Apps for Kids: Disclosures Still Not Making the Grade. The report examines the privacy disclosures and practices of apps offered for children in the Google Play and Apple App stores and finds most mobile apps don’t even have privacy policies. 

This is the second report released from the FTC this year examining mobile apps and privacy issues relating to children. The first FTC Report was issued in February 2012 and found that “neither the app stores nor the app developers provide the information parents need to determine what data is being collected from their children, how it is being shared, or who will have access to it.” 

The FTC examined hundreds of apps and found: 

  • 80 percent made no privacy disclosures
  • 20 percent provided a link to a privacy policy
  • 60 percent of the apps shared information with ad networks or other third parties
  • 58 percent, contained advertising targeting kids
  • 15 percent disclosed the presence of advertising prior to the download 

The Association for Competitive Technology, which represents thousands of developers, said mobile apps developers are often young, inexperienced and unaware of their legal obligations. "This report reminds us how important it is for the industry to focus attention on educating developers on privacy best practices," the organization's executive director, Morgan Reed, said in a statement.

"At the FTC, one of our highest priorities is protecting children's privacy, and parents deserve the tools to help them do that," said FTC Chairman Jon Leibowitz. "Companies that operate in the mobile marketplace provide great benefits, but they must step up to the plate and provide easily accessible, basic information, so that parents can make informed decisions about the apps their kids use. Right now, it is almost impossible to figure out which apps collect data and what they do with it. The kids app ecosystem needs to wake up, and we want to work collaboratively with industry to help ensure parents have the information they need." 

The first FTC Report, released in February, notes that mobile apps can capture a broad range of user information from a mobile device automatically, including the user's precise geolocation, phone number, list of contacts, call logs, unique identifiers, and other information stored on the device. At the same time, "the report highlights the lack of information available to parents prior to downloading mobile apps for their children, and calls on industry to provide greater transparency about their data practices." 

"While we think most companies have the best intentions when it comes to 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," said FTC Chairman Jon Leibowitz.  "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." 

The agency declined to provide information about which companies it plans to investigate in the coming months.


Brad Friedman

President, The Friedman Group, LLC

Brad Friedman is a “Recovering Attorney” living in Denver, Colorado. In 2010, Mr. Friedman parlayed his passion for technology and his business, legal and marketing savvy into the creation of The Friedman Group, LLC. Brad has developed a group of highly skilled people to work with attorneys, CPAs, financial services providers, small businesses and other professionals to develop strategies that enhance their online presence and engage clients, prospects and referral sources through the power of inbound and social media marketing with the goal of generating leads and revenue.

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