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Continuing discussion on mobile app privacy (NTIA)

I attended a recent discussion hosted by the NITA (dept of commerce) which is a continuing effort to develop a set of best practices for mobile app developers regarding the collection and use of personal consumer data. First, major congratulations to the NTIA for taking this on. As anyone knows has attended one of the meetings knows, and given all the voices that want to be heard, it’s a herculean task to facilitate the events.

Much was discussed at the meeting, such as the appropriate use of the word “should” versus “shall;” or the choice of the word “data” vs “file” vs “information; just how and when, exactly, should an app present a list of collected data elements to the user (i.e “shall” they display all data elements, or “should” they?). These issues, as I came to learn, are non trivial.

What I found most interesting, however, was a point made by one of the participants who was calling on all stakeholders to convince the FTC to take a more active role in the process. The issue is this: the best practice document, in whatever form it takes, will be voluntary. That is, no developer will be *required* to adopt it. However, the consensus seems to be that once they choose to adopt, they will be legally bound by it. That’s right — *legally bound* by it. Enforcement appears to come from the familiar section 5 of the FTC act regarding unfair and deceptive practices. Essentially, once the company *agrees* to comply with the best practices, failure to *actually* comply constitutes a deceptive practice which becomes an enforceable action by the FTC. We’ve seen this same approach regarding privacy policies (i.e. a company claims to not collect data, but then does anyway).

This raises an interesting question: given the cost of adoption, the potential liability, and absent a mandate to adopt, why would *any* firm agree to adopt it?

Well, they might choose to adopt in order to signal that they’re a good corporate citizen and ingratiate themselves in the eyes of consumers. Given that this is really just a form of self-regulation, firms may want to comply simply to stave off a stronger, more onerous form of regulation that might one day be forced upon them.

The second part of that participant’s point was that there should also be a safe harbor for those firms who choose to adopt, but somehow mistakenly goof up one of the elements. This seems like a reasonable request. The tensions are clear: policy makers want to see all firms adopt the best practice, but it is costly for them to do so. The cost comes from retooling their apps, in addition to any expected costs from litigation or sanction. So, offering a safe harbor for those firms who mostly comply reduces future expected costs.

It’s too early to anticipate the level of adoption based on the participants in the room, and the fact that the document is unfinished, but I wish the NTIA best of luck!

 

More information on the effort can be found at: http://www.ntia.doc.gov/other-publication/2013/privacy-multistakeholder-process-mobile-application-transparency

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