FTC clamps down on privacy- Apple, Google beef up – AAPL, GOOG, FB, MSFT, AMZN & BB

Boston, MA 02/27/2013 (wallstreetpr) – Google Inc (NASDAQ:GOOG), Apple Inc (NASDAQ:AAPL) and a mass of software developers are gearing up to face the rules and fines that the U.S federal trade Commission is putting in place to deal with the privacy violations that occur with the use of various mobile applications. Analysts are saying that the move will have a negative impact on market growth. This month the FTA fined the social networking site, Path 1 Network Technologies, Inc (PINK:PNOT) for collecting user data in an unauthorized manner and is in the process of scanning mobile applications for similar privacy violations. Congress-led legislation that will boost data protection and disclosure is also in the pipeline.

Your information is mine

At the moment it is commonplace for developers to track the buying preferences, whereabouts and surfing habits of users. This helps them add to their coffers as their applications are chock-a-block with features and ads. However, what this entails is that user privacy is at risk. This is exactly where the problem lies. Tighter consumer protection laws will mean an increase in costs for smaller companies who are the suppliers of apps that increase the demand for tablets, smartphones as well as mobile advertising. A prominent market analyst has been quoted to state that legislative actions would lead to heavy setbacks and that the mobile advertising market would be directly impacted by them.

The Android software by Google Inc (NASDAQ:GOOG) holds top rank in mobile software and Apple Inc (NASDAQ:AAPL) comes in second. Close to 91 percent of smartphones use these two operating systems. These as well as other companies like Facebook Inc (NASDAQ:FB) and Twitter Inc earn a lot of profits from advertisements that are embedded in various applications that they develop for mobile phones in addition to the revenue that goes into their pockets. Most prominent companies have procedures in place to safeguard user data which unfortunately is not enough.

Setting a precedent

Privacy settings can be adjusted, installation and deleting of applications can be prevented by tools such as Apple Inc (NASDAQ:AAPL)’s “Restrictions”. Photo, location and contact information can be safeguarded by users using various other tools. Companies are hoping that with all these measures in place, the FTA will ease off on adding new rules and regulations. Though larger companies are able to absorb the costs of developing and launching tools such as these, the smaller developers are threatened to be pushed out of business. As the FTA clamps down heavily, companies are feeling the heat. The FTA set a precedent with the Path ruling.

Standard laws across segments

Assistant director of FTC Christopher Olsen said that the size of the company cannot reduce its legal responsibility in any way and that all strictures will be enforced across all segments. The mobile-technology unit set up by FTC around two years ago has put forth recommendations that companies such as Apple Inc (NASDAQ:AAPL), Google Inc (NASDAQ:GOOG), Microsoft Corporation (NASDAQ:MSFT) and Amazon.com, Inc (NASDAQ:AMZN) will have to set up additional privacy requirements such as real-time privacy notifications. The Apps Act is aiming at a safer online environment for consumers of web-based applications.

Shares of Apple Inc (NASDAQ:AAPL) went up by 1.39% to close at $448.97

Shares of Google Inc (NASDAQ:GOOG) went down by 0.08% to close at $790.13

Shares of Facebook Inc (NASDAQ:FB) went up by 0.44% to close at $27.39

Shares of Microsoft Corporation (NASDAQ:MSFT) were steady at $27.37

Shares of Amazon.com, Inc (NASDAQ:AMZN) went down by 0.02% to close at $259.36

Shares of Research In Motion Ltd (TSE:BB) went down by 0.15% to close at $13.46

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Published by Donna Fago

I believe in writing content Informing investors with the knowledge they need to invest better today- I have been following the markets for many years and was asked to join the team at WallStreetPR.com recently due to my passion for the markets.