But consumers are beginning to rely so much on this capability in their cellphones--to look up directions, for example--that "customers are going to expect that," said Brian Knapp, chief operating officer of Loopt, a service that lets consumers use their cellphones' GPS function to locate friends and nearby businesses.
He was at a meeting of the Commerce Department's Online Safety and Technology Working Group, along with privacy and security officials from Facebook, MySpace, Ning, Disney and Zynga. Knapp said one of Loopt's biggest challenge is overcoming the perception that it is surreptitiously tracking consumers' location night and day.
"Nobody reads privacy notices," he said. "We know that. It’s ok."
To still make sure people understand what they're allowing the application to track, "we can supplement with privacy notices along the way, by breaking out the most important parts and educating them on how to use it."
He said some privacy advocates have blown the issue out of proportion. "If you ask people, do you want to be tracked 24/7 by the government? The answer's going to be no. But if you ask them if you want to share your location information so you can get directions, find a restaurant or movie theatre, the answer's probably going to be yes. Let's not get alarmist about it."
But he said consumers should be able to opt in to the tracking their location. Before looking up an address or movie schedule, the application should first ask users, "is it OK to use your location?" he said.
Dane Snowden, vice president for external affairs for CTIA, the wireless industry's lobbying association (of which Loopt is a member), said the opt-in feature is key.
"One of the things we realized at the very beginning is that consumers need to be able to opt into any of these services versus having to opt out," he said. "When you're asked again and again to use your location, sometimes it's annoying, but it's the balance we need to have to protect safety."
Loopt has a new application, called Loopt Mix, that lets you meet strangers who are your vicinity. The application is intended only for users over 18 years old. But age verification has proven difficult for most social networking sites and applications.
The Federal Trade Commission has looked at developing standards recommendations for location-based services over the past two years or so.
On a different note, FTC staff attorney Phyllis Marcus told the group that the agency would release its formal virtual world review on Dec. 10. The report, mandated by Congress, will look most closely at "explicit content" on virtual world sites such as Second Life.