In response to the upsurge of mobile application popularity among smartphone users, the Mobile Marketing Association (MMA) has released a policy to address privacy issues
"Anybody paying attention to privacy issues saw a developing void, and we moved to fill it," said Alan Chapell, co-chairman of the MMA Privacy & Advocacy Committee. "There are few apps policies in the marketplace and little guidance, and we believed this was a great opportunity for the MMA to address that need by producing a model policy for the mobile marketing industry."
"That way, as a developer is creating the newest, great tech, they're also working on policy -- not as an afterthought, but as something that you work on during development," Chapell said. "Privacy by design, which has been touted by the FTC [Federal Trade Commission] as something that interactive companies should be engaging in, is the overarching goal."
The MMA's proactive approach to mobile application privacy comes amid increased federal attention to protecting online consumers' personal information. Last December, the FTC got the ball rolling when it released its report, "Protecting Consumer Privacy in an Era of Rapid Change." The report implored companies to "promote consumer privacy throughout their organizations and at every stage of the development of their products and services."
Since then, several high-profile breaches of consumer information, including that of Sony customers last spring, led to Senate committee hearings on online consumer privacy. Earlier this month, the Subcommittee on Commerce, Manufacturing, and Trade held a hearing on "Understanding Consumer Attitudes About Privacy." Linda Woolley, a member of the Digital Advertising Alliance's board of directors, was among those who testified on self-regulatory principles for online behavioral advertising, saying that the principles strike a proper balance between good business and the protection of consumer information.
"Our industry has done a tremendous amount of work to make sure that consumers have transparency about online behavioral advertising, and that consumers can exercise control over their preferences -- including opting out, if they so desire," Woolley said during her testimony.
The position of MMA since Day One has been that privacy and transparency are key to doing business in the marketplace.
Alan Chapell, co-chairman, Mobile Marketing Association Privacy & Advocacy Committee
Woolley also referenced the marketing industry's concerns surrounding regulations' potential impact on online business. She pointed to the subcommittee's Sept. 15 hearing on "Internet Privacy: The Impact and Burden of EU Regulation," during which Catherine Tucker, a professor at the Massachusetts Institute of Technology in Cambridge, Mass., testified about the European Union's e-Privacy Directive's effect on advertising performance. The directive limits the ability of companies to collect and use behavioral data to deliver relevant advertising, and Tucker's research found that the directive was associated with a 65% drop in advertising performance. NetChoice, a coalition of trade association, e-commerce businesses and online consumers, has estimated that this figure would translate to a loss of $33 billion for American businesses over five years if the U.S. adopted similar regulations, Woolley said.
But Chapell isn't convinced that putting mobile application privacy rules in place would have a negative effect. Instead, he said it would create and maintain customer trust because it would help alleviate consumers' concerns that their information could be accessed by others. He noted that, as of June, 425,000 individual apps were available via the Apple App Store, and more than 200,000 were available for Android devices, showing the great need for mobile application privacy guidelines to protect consumers.
"The position of MMA since Day One has been that privacy and transparency are key to doing business in the marketplace," Chapell said. "We see this as completely positive."
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