• by Wendy Davis  @wendyndavis, September 12, 2012

A new privacy bill unveiled on Wednesday by Rep. Ed Markey (D-Mass.) would require wireless phone manufacturers, carriers and app developers to inform consumers about monitoring software installed on their devices.

The Mobile Device Privacy Act (HR 6377) provides for companies that market software that transmits data about geolocation or how people use their devices. The bill says those companies must inform consumers what type is data collected, who will receive the data, and how it will be used.

The proposed law specifies that companies must disclose this information before people purchase phones with monitoring software, and before they install apps with those features.

"Consumers should know and have the choice to say no to software on their mobile devices that is transmitting their personal and sensitive information," Markey stated on Wednesday.

Markey indicated that the proposal stemmed from allegations that Carrier IQ's software -- pre-installed on an estimated 150 million phones -- was logging keystrokes. Late last year, a researcher posted a video clip that appeared to show Carrier IQ tracking his keystrokes. Carrier IQ responded by saying that its software sometimes captures the contents of messages, but that the data is encoded. The company said the logging was a bug, and that its software was intended to help mobile carriers to discover the source of network problems, like dropped calls.

Carrier IQ isn't the only mobile company to find itself at the center of recent privacy controversies.

Earlier this year, it emerged that app developers like Path and Hipster were collecting users' address books without telling them. Since then, Google and Apple said they would require apps distributed through them to inform users about data collection in advance.

Broadband advocacy group Free Press is backing the bill, even though the group tends to involve itself more with online access issues than privacy. "We need some kind of general principles that clearly state what's permissible and what's not," Free Press legislative director Joel Kelsey tells Online Media Daily. He adds that questions about privacy and broadband online access "bleed over" if privacy concerns discourage people from using technology.

But the Software & Information Industry Association panned the proposal, calling the bill "the wrong way to go." The group said the measure "would impose rigid privacy rules on the mobile industry that can only lead to stagnation and a loss of innovative dynamism."

The bill isn't likely to come up for discussion until next year, after the elections.