Mobile apps are nothing new, and they play a significant role in our day-to-day lives. There’s no denying their marketing and advertising power, which is harnessed by businesses, charities, and other groups. And it seems as if new mobile apps are rolled out on a near-constant basis.
Of course, there is also the reality that while a mobile app is an effective way to attract new customers or engage a widespread audience, they also collect a vast amount of personal data from the people who use them.
Data collection can include basic information, such as names and email addresses and also encompass more sensitive data, including location, health details, and purchasing habits.
While this data is a valuable resource for marketers and app developers, privacy concerns abound, especially as consumers become more concerned about data breaches and misuse. Ultimately, there is a great demand for increased control over sensitive and personal information, which has led to the creation of varied data privacy laws around the globe.
Therefore, it is imperative for app developers to understand and follow these laws–not just for regulatory compliance but also to maintain user trust and ensure the longevity of your business.
Understanding Key Data Privacy Laws
The complexity of data privacy laws can be a huge hurdle for mobile app developers, primarily because this type of technology doesn’t have any geographic borders, meaning that mobile apps can basically be used anywhere in the world. Varied laws and regulations come into play, and a mobile app developer must possess a solid understanding of what regulations apply to them in order to remain compliant and avoid penalties.
Here is a breakdown of the key data privacy laws:
- General Data Protection Regulation (GDPR): Enacted by the European Union (EU), this is one of the most comprehensive laws on the books globally. With GDPR, app developers must obtain consent from users prior to collecting or processing any data–and users have the right to access, correct, and delete their data at any time. Considerable security measures must be in place on any app, and should a data breach occur, users and authorities must be made aware within 72 hours.
- California Consumer Privacy Act (CCPA): This applies to any user accessing an app from California–but even if you are an app developer in Michigan you must ensure your mobile app complies. It is similar to GDPR in terms, and violations for non-compliance are expensive, reaching up to $7,500 per violation.
- Children’s Online Privacy Protection Act (COPPA): If an app has an audience that includes children under the age of 13, this law requires verifiable parental consent to be obtained before any personal information is collected from the underage user. The app must also have a privacy policy in place and parents must be able to review and delete their child’s information at any time.
There are other regional and national laws that mobile app developers need to be well-versed on. It’s always considered a best practice to consult with an attorney who is knowledgeable about varied data privacy laws and how they apply to the mobile app development business.
Why Business Structure is Key
It’s common for many mobile app developers to be independent freelancers. As such, very little thought might be put into the structure of their business, and they simply operate as a Sole Proprietor.
However, there is considerable risk in not examining this further.
Why? Because when you operate as a Sole Proprietor, there is no barrier between the personal and professional and if your mobile app violates data privacy laws, you could be held liable. That means assets like your personal savings account or house could be at risk, along with your business revenues. Ultimately, there is no divide between the two.
To address this, one strategic step a mobile app developer may take is to form a Limited Liability Company (LLC).
An LLC is a business structure that enables personal liability protection for its owners (called Members). This means that if your mobile app faced legal violations, like a lawsuit because of a data breach or non-compliance with laws, personal assets like bank accounts, retirement portfolios, and real estate would not be up for grabs. The liability would be strictly limited to the assets of the business.
Now, the way to start an LLC varies by state, so requirements to form an LLC in Florida could be different from that of a mobile app developer operating in Kansas. As such, it’s important to know the rules associated with your state. However, the benefits go beyond personal liability protection alone.Â
When you decide to form an LLC, your mobile app development business gains professional credibility, which could help attract bigger clients or potential investors. Plus, LLCs enjoy great tax flexibility–enabling the choice of taxation as a Sole Proprietor, Partnership, or Corporation. Plus, when you file for an Employer Identification Number (EIN) with the IRS, you are able to add employees, and potentially grow your company and revenues.
An LLC could be the best choice all around for protecting yourself and your finances as a mobile app developer.
Key Principles of Data Privacy Compliance
Compliance goes beyond simply understanding the regulations and involves implementing best practices as to how your app handles user data. Here are the key points to be aware of:
- Only collect the necessary data that is central to the app’s functionality. Collecting excessive information not only increases the risk of non-compliance but it also makes your app appear untrustworthy.
- Consent is always needed on behalf of a user and you must explain what data you collect, why you need it, how it will be used, and how long it will be stored. It’s usually best to communicate this via an easy-to-access privacy policy.
- Users must control their data. They have to be able to access, update it, and delete it whenever they choose.
- Encryption and other security measures should be in place to protect user data from unauthorized users, breaches, or hacks. Conducting regular security audits is also a best practice.
- If you share services or data with third-parties, make sure these groups also adhere to the same data privacy laws that you’re beholden to–and have agreements in place.
Commit to Data Privacy Compliance for Success
The success of your mobile app – and your business–hinges on your ability to follow data privacy laws. This is essential in today’s privacy-conscious world. Consult with legal and privacy experts on the regulations that apply to you and stay informed about updates and changes, especially in regions where your app operates.
Remember, data privacy is not simply about compliance–it’s also about showing your users that you’re trustworthy and that their privacy matters. Take proactive steps in your mobile app development process and demonstrate to users that you respect their rights while holding the law in high regard.
