The Silicon Valley technology giant AppLovin is facing a new round of regulatory pressure due to user data processing problems. According to the New York Post, AppLovin had raised concerns this spring about an attempt to acquire TikTok and was facing a private investigation by the United States Securities and Exchange Commission (SEC) and could be subject to a joint investigation by the State Attorney General.
According to Bloomberg, the SEC is investigating whether Applovin “misleaded investors in data collection and advertising”, after being previously an empty body that accused the company of using digital “fingerprints” to mistook users for precision advertising. Last Wednesday, AppLovin announced the closure of a product called “Array”, which had been previously advertised for downloading without the consent of the user. The statement was made a few days after the publication on 13 October of a report by researcher Ben Ederman (a blank position in AppLovin) that forced the downloading of the source code. Ben Ederman ‘ s allegations have not been substantiated. In response, the spokesperson for AppLovin stated that “the user must give its express consent to download the application through our advertisement” and stressed that “Array is only a test product”. At the same time, according to well-known sources and mail from the New York Post, state regulators, including the Attorney-General ‘ s Offices of Delaware, Oregon and Connecticut, have contacted a number of empty institutions and appear to be conducting preliminary investigations against AppLovin.
According to sources, the survey, which began in March and continued throughout the summer, focused mainly on the data collection behaviour of AppLovin. The company added that its advertising platforms were subject to “policy and enforcement measures in line with industry standards” and applied to both publishers and advertisers. In addition to local privacy and consumer protection laws, the Länder may exercise enforcement powers under the Federal Child Online Privacy Protection Act (COPPA). It is not clear whether the state-level investigations focus on COPPA irregularities. Despite the allegations, AppLovin ‘ s share price has risen by 80 per cent this year and is included in the General 500 Index, which is driven mainly by AI software that helps developers sell commercials.
An explosive analysis released in February by Fuzzy Panda, an empty agency, accusing Applovin of “as if he was following children illegally” – – Including the distribution of digital fingerprints from underage accounts that are not clearly labelled “do not trace”, in violation of the Apple Google policy. It also published evidence that AppLovin placed sexual violence advertisements when parental control was introduced.
In a report that is believed to trigger the investigation, Fuzzy Panda claims that by setting up a test account for a 10-year-old boy, AppLovin was found to be continuously tracked through a unique ID during the game and to be able to “strengthen the fingerprints” in conjunction with data from a third-party data dealer to effectively track children. The analysis states that an old SDK can collect 50 attributes of equipment (including geographic location, precise start-up time in milliseconds) sufficient to identify child users in the family. On 26 February, Culper Research, an empty body, alleged that AppLovin had “systematic use of hazardous applications to enable application advertisements to be installed silently on the back door of a user’s mobile phone by single-clicking”. Ben Ederman ‘ s report this month compiles over 200 complaints of forced downloads of Array products, including cases where users use silent installation when watching advertisements.
On 26 February, Chief Executive Officer Adam Forrugi of AppLovin posted a blog denying all allegations that the company complied with the rules of all applied shops and did not track data on children. In response, the spokesman for Applovin again stressed that the “false and misleading” nature of the empty report was derived from a “manifestly financially motivated” institution, contrary to the “third-party sources and corporate statements”. The event coincided with the legislative process in the United States Congress to strengthen the Child Network Protection Act. This year, the Senator resubmitted the revised version of the COPPA to prohibit targeted advertising for users under the age of 17. A number of other lawsuits are under way, including allegations by residents of California that AppLovin has followed up on his shopping decisions, applications and movements through reverse IP search techniques after he shut down his mobile phone.