FTC's Second Kid's App Report: Disclosures Not Making the Grade

The Federal Trade Commission has just released of their second report reviewing the practices of apps targeted to kids. “Apps are often free, which is great for kids and easy on their parents wallet.” FPF Co-Chair and Director, Jules Polonetsky said, ” but when free means in return for data, app developers must understand the legal obligations that come with collecting kids data.”

The Commission repeated the methodology from their earlier report, but went several steps further this time – they downloaded the apps to compare whether the privacy notices accurately disclose the collection and sharing practices of app developers. The Commission found that only 20% of the 400 apps downloaded provided a link to a privacy policy prior to downloading the app. Among the apps that provided notices, these policies failed to provide critical information for parents as to how information is collected, used and shared. Moreover,  the survey shows that many apps fail to disclose that they transmit data to third parties and contain interactive features. For example, 58% percent of apps contain advertising but only 15% disclose this fact.

“Kids privacy is no longer an optional extra for App Developers given the heavy regulatory scrutiny that exists today,” said Christopher Wolf, FPF Founder and Co-Chair. Before downloading apps to children, parents should be able to learn what data an app collects and how it will be used. Indeed, the report states that the Commission is launching non-public investigations to determine if developers are violating COPPA or engaging in unfair or deceptive practices.

The FTC was particularly concerned about Device IDs being sent to ad networks, but recognized that doing so for analytics or other limited purposes wasn’t the primary privacy concern.  Rather, the Commission was worried about behavioral ads using Device IDs, a practice it has targeted in its proposed update to the Children’s Online Privacy Protection Rule.  The Commission has also launched a number of investigations stemming from the report.

The Commission called on app stores, app developers and third parties that interact with the apps to work together to develop accurate disclosures for parents.  FPF provides privacy resources for app developers, including COPPA information at www.applicationprivacy.org.  FPF is also working to provide a path for app platforms to be able to take more of a role in handling parental notice and age verification for apps by seeking clarification to the COPPA rule by supporting creation of “common consent mechanisms”.