The first cell phone I saw was a brick. Not literally, but its weight, size, and shape was eerily similar to that of a building block. Today, mobile phones come in all shapes and sizes, and none of them resemble anything close to a brick. From “old-school” flip-phones to the newest smartphone, cellular telephones have become one of the most ubiquitous pieces of technology.
The advent of the smartphone in particular has changed the landscape of communications technology. New, flashier interfaces and networking capabilities have given rise to mobile applications that allow vendors to wirelessly swipe your credit card on their phone, or give bored commuters a needed respite from thinking about work as they launch birds at teetering structures. However, mobile applications have been making news in the legal realm recently for all the wrong reasons.
On August 15, the FTC issued a press release announcing W3 Innovations, LLC (d/b/a Broken Thumbs Apps) had paid a $50,000 fine due to a violation of the Children’s Online Privacy Protection Act (COPPA). The fine was issued because the company collected information from users under the age of 13 without notifying the child’s guardian or obtaining parental consent, disregarding Rule 16 C.F.R. Part 312 of the COPPA.
This happened shortly after the FDA had released a draft guidance outlining the regulation of mobile applications “targeted to assisting individuals in their own health and wellness management.” These two events, while separate incidents, have piqued the interest of several LexBlog Network publications.
The TMT (Telecom, Media and Technology) Law Watch, a K&L Gates blog, has two posts of note. The first touches on the draft guidance issued by the FDA, and the second takes a look at how the FTC came to the conclusion to fine W3 Innovations, LLC:
“The FTC found that the apps at issue contained “subject matter, visual content, and language” that was directed at children under the age of 13, which directly implicated the COPPA requirements. The allegations in the complaint suggest that the FTC was most concerned with two aspects of the apps’ operation. First, the FTC took issue with the apps’ invitation for users to “e-mail Emily,” the fictional namesake of the apps, and the developer’s subsequent collection and maintenance of e-mail addresses from individuals who were likely to be children, even though those e-mail addresses were not publicly displayed. Second, the FTC called out the blog feature of several of the apps, which permitted users to submit comments (which could include personal information), and required users to provide a name when submitting a comment. “
Over at Proskauer Rose LLP’s Privacy Law Blog, Charley Lozada takes a more in depth look at the COPPA and how developers should respond:
“The challenge presented by COPPA and other privacy laws for App developers is to effectively communicate privacy policies on the small screen and through the download interfaces provided by Apple, Android and other platforms. This challenge may account for the fact that, according to some accounts, almost three quarters of the most popular mobile Apps do not have a privacy policy at all. But the FTC has made clear, through this action and in other public statements, that regardless of the limitations of a small screen, App developers must find ways to comply with the notice and choice rights afforded to consumers under COPPA and other applicable privacy laws.”
Hogan Lovells’s Chronicle of Data Protection changes the pace with a look at the overarching impact of privacy laws and mobile applications in response to the FTC’s fine:
“With apps come an array of privacy issues. With software hosted locally, the privacy issues are circumscribed. The user knows who is getting his or her data and how it will be used. In the app world, which often implicates cloud computing, there is a serious question of how app developers will handle privacy. A recent study by the Future of Privacy Forum, founded and co-chaired by Hogan Lovells’ privacy lead Chris Wolf, found that nearly three-quarters of the most -downloaded mobile apps lacked even a basic privacy policy. In May, Sen. Al Franken (D-Minn.) sent a letterto the chief executives of Apple and Google asking that their companies require app makers to have clear, understandable privacy policies.
In a New York Times article today entitled “Industry Tries to Streamline Privacy Policies for Mobile Users,” a new tool for app developers to create a mobile privacy policy is described as is an industry-led effort to provide an opt-out of targeted advertising based on the collection of user information.”
Finally, in an interesting (and somewhat related) development, the Software Licensing Blog reports that Google bought up Motorola for $12.5 billion. While this is not directly associated with the FDA’s draft guidance or the FTC’s decision to levy its fine, it does increase the ties between information technology companies (the folks creating apps) and the telecommunications industry (who host the apps):
“Google was sitting on $39 Billion in cash. Google owns Android and Motorola Mobility is a dedicated partner. Motorola Mobility is sitting on 14,600 patents and another 6700 patent pending apps. So the leading search engine and online advertising goliath is combining with not only a strong Android smartphone manufacturer but also the “market leader in the home devices and video solutions business”.
Google co-founder and CEO Larry Page stated that Motorola Mobility will “enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies”. It remains an open question how HTC, LG, Samsung, Sony Ericsson, Acer, Lenovo and other Android device makers will handle this acquisition. Wauters gives us a link in his announcement to reaction already from some of these vendors.”
As more developers create new and interesting mobile applications, more regulation is almost a forgone conclusion. Apps have access to sensitive information pertaining to their users, and privacy laws will almost certainly have to be tailored directly to the creation and use of these applications. While I personally have no qualms with apps knowing where I eat, I also don’t want medical companies to have access to any information gleaned by an app. So the next time you think of Apple’s (now trademarked) phrase, “There’s an app for that,” you may want to wonder if there’s a privacy law for it too.
#COPPA