Stricter mobile location data restrictions might be coming to Europe

The debate over mobile devices and user data privacy is still very much alive and frothing in the U.S., but over in Europe, Apple (AAPL) and Google (GOOG) may be on the brink of facing tighter restrictions on what data they can collect from their device users and how they can utilize it.

The new regulations are in response to some widespread revelations that happened last month, when some researchers made the public very aware of the fact that smartphones, specifically Apple’s iPhone 4, had been tracking users’ location data whenever their devices’ GPS pinged a nearby cellular tower. This meant that the phones were tracking people wherever they went, and saving the data indefinitely in an unencrypted file within the phone that was even backed up to iTunes when the iPhone was synced with the program.

The location tracking information sparked quite a bit of controversy and backlash among the public as the story spread around. It turned out that devices running Google’s Android operating system and Microsoft’s (MSFT) Windows Phone 7 also tracked user location data, reportedly in order to help the companies maximize service, gain information about how their devices interacted with Wi-Fi routers, and check the efficiency of cellular towers. But while Apple’s location tracking was occurring without users knowing it, both Google and Microsoft asked users for permission to gather the data before doing so.

Apple has claimed the location data, which is used by apps that tap into the iPhone’s GPS capabilities when they run, was being saved in error. In order to work, the GPS needs to gather and store some data about location, but Apple issued an update so that the cache where that data was ending up was encrypted and regularly emptied, rather than just continuing to fill with information over time.

Still, politicians in the U.S. and Europe see a lot of potential for privacy breaches with the use of smartphones and the data they track, much of without regulation given how fast the mobile sphere has exploded in recent years. One researcher admitted that iPhone location data before the update had been used by law enforcement officials, though he wouldn’t say from which agency.

Now, according to a story from Financial Times, a European Union data protection advisory panel has ruled that the information mobile devices gather and store should be deemed “personal data,” and with such a designation are likely to be some stricter guidelines as to what companies like Apple and Google can do with it.

In addition to facing inquiries in the U.S. over location tracking, Apple is facing the music in Germany and South Korea as well. In Germany, researchers warned against Android users connecting to public Wi-Fi networks, as their devices could be easily hacked and giving data away to others without their knowledge. Google says it’s fixing the security hole right now.

Here’s a quote from FT’s story:

“The recent security breaches add urgency to Wednesday’s recommendations by the Article 29 Working Party, a panel of European data protection officials that advises the European Commission. The proposals are a first step to formulating a law on mobile phone location data, and could be written into Europe’s revised Data Protection Directive this year.”

While Google and Apple both say they are very careful with location data and that the data is necessary for smartphones to have for things like emergency services, greater regulation in Europe could have a serious effect on all kinds of apps that make use of location data.

And a similar situation in the U.S. may not be far off, either.

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