Consumers Demand Greater Data Privacy from App Economy

by Istvan Fekete on April 25, 2013

The rapid adoption of smart devices — thanks to the marketing push from carriers — has fuelled the growth of apps in the mobile economy. We don’t have to go too far, just take a look at the two tech giants, Apple and Google, and their app storefronts: the App Store now counts 850,000 iOS apps, while Google Play is second to Apple with roughly 700,000 apps.

Mobile app market reports highlight that the era of paid apps is fading, with the new trend being “freemium is premium,” which means users prefer to download free apps from stores rather than paid apps.

Now, when you download a free application to your smartphone or tablet, you usually need to share some sort of personal information, such as your name, email address, browsing preferences, location, and more.

This is the price you pay for a free app. Up until now, there has been nothing wrong with this model, as the collected information can be used to benefit both parties: users can access free content or can receive tailored ads. The question is how this personal information is used. In other words, the key issue is transparency, as we are talking about private information.

Research carried out by MEF sheds light on how consumers react when in comes to their private information: only a third of consumers are comfortable sharing personal information with an app. This means either consumers are choosing to ignore apps until such time as they can trust them not to share their personal information, or worse, they are engaging with apps not knowing that the app is sharing information without their permission.

Interestingly, the report found that 70 per cent of consumers say it’s important to them to know exactly what data an app is collecting and what data is being shared. Nearly half say that it’s very important. This says very clearly that consumers understand the impact of apps on their privacy and importantly that they want to have some control.

Consumer trust is a company’s most valuable asset; it is hard to gain and even harder to regain if the app provider isn’t transparent about what it is doing with the data it collects.

Although there are some good initiatives in the industry such as the iOS’ “Privacy” feature that allows the user to limit the apps’ access to private information, there is a long way to go until we will see properly working, fully transparent apps.

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Written by: Istvan Fekete. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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