Maybe there shouldn't be an app for that

What they know about you

Smart Money has a rather disturbing article about those apps you download for your smart phone. Consider:

App developers know  all about you and how you use their apps. If, for example, an application you use involves banking, a malicious developer may be privy to your account details, according to John Hering, CEO of Lookout, a mobile-security company. Google, Apple and other vendors also know which apps you bought, which you use and which you have erased from your phone. Developers and the analytics companies they employ access much more detailed data about how you use the app. They can see, for example, how often and for how long you played a game and everything you did in it, says Peter Farago, VP of marketing at analytics firm Flurry.

All this data is invaluable to developers, who use it to improve their apps. They can also use it to build audience profiles in order to help attract ad dollars. Advertisers may be looking for gaming fans, for example, and want to target ads to people who spend lots of time using particular titles—information app developers then share with the middlemen who sell ads. “On the mobile platform, you know exactly who you are targeting ads to so you can target more specifically,” says Rob Terrell, founder of the app developer TouchCentric.

What else can happen to your personal information?

All that data about you tied to your smart phone gets circulated through an ecosystem of companies. Problem is, there are no rules about what they can do with it, other than some regulations about when it can be turned over to the government, says Jared Kaprove, former domestic-surveillance counsel with the Electronic Privacy Information Center.

More troubling, many of these companies—particularly the small ones—lack clear policies for using and storing your data. It can easily be stolen or misplaced, which can happen even at large corporations with good data-security practices. People simply aren’t aware of how their data gets used and how valuable it is, says Kaprove, and “companies prefer that you just don’t think about it.”

Fearing consumer perception of privacy issues—what Farago calls the “Big Brother creep factor”—the industry is trying to be open about its use of data and allows users to opt out of having theirs collected. But that can be a challenge, says Frank Dickson, VP of research at market-research firm In-Stat. “Any time you’re interacting in the public domain, you are going to leave bread crumbs,” he says.

Glad I have a dumb phone.