As smartphones become more prevalent, mobile privacy issues also become much more of a concern. The root of the issue is with the user data that the apps collect. Consumers obviously want a great user experience, but they also want their data respected, which makes for a challenging situation.

The fact that the mobile app environment is still very new only adds to this issue. As Jules Polonetsky, the Director and Co-Chairman of the Future of Privacy Forum, explained to us, it wasn’t too many years ago that consumers bought phones from carriers that had apps and services already baked into them. At that time, the carriers were in charge of making sure the services ran as they were supposed to. But today, thanks to Apple, Google and other platforms, the system has opened up.

While these developments have given consumers a lot more choice in what they have on their mobile devices, Polonetsky told us that they have also resulted in privacy confusion for many people including consumers, developers, and policymakers. The reason is due to the lack of standards or guidelines for the parties involved to follow.

What’s more, according to a recent study from the Future of Privacy Forum, only one-third of all apps have privacy policies. The think tank reviewed the most popular free and paid apps and found that 66 percent of the privacy apps surveyed had privacy policies, while only 33 percent of the paid apps had them.

Polonetsky told us that the free ones are more apt to have policies because they make money by gathering data. In other words, these apps want to collect data in order to provide more targeted advertising and make money in return.

Although most consumers don’t pay very much attention to privacy policies, they still want apps to have them.

“It’s great that they [developers] can get data, because it’s the data that’s really made these apps really interesting,” said Polonetsky.

“We want these apps to have the data that is on that mobile device,” he continued,” but we need to know that they’re gonna use it in a respectful way.”

Privacy advocates, including Polonetsky, believe that it is critical to address mobile privacy concerns now before the issues get worse. At this point, nearly every major company has an app, which means that a lot of data is floating around. Furthermore, if something goes wrong with this data, it could result in some very bad situations for consumers.

There are already some issues being raised as social discovery apps or “ambient social networking apps” become more popular. After this year’s SXSW event, we saw apps such as Highlight, Glancee, and Banjo really take off. These location-based apps run in the background on mobile devices and notify users when their connections and acquaintances are around them.

Some people enjoy the discovery that these types of apps bring, but at the same time, they don’t want every aspect of their lives to be public. In addition, some of these apps including Socialcam and Viddy publicly share user actions without the user’s knowledge, which could greatly harm reputations.

“It’s really critical that we help draw the lines – that the platforms draw the lines and that these apps, on their own, draw the lines,” Polonetsky explained, “so that we can have the viral excitement of new discovery and easy sharing to expand the way people find content online without anyone ever accidentally sharing and being embarrassed.”

“We don’t want people uncomfortable about something that’s in their pockets,” he added.

Polonetsky went on to say that the responsibility in solving these concerns falls on many people. He thinks that the platforms, the app developers, and even the consumers play a role. However, he was quick to point out that app developers, in particular, needed to step up to find solutions.

“We gotta get it right and we gotta look at the app developers to lead the way,” he said.

The platforms are responsible for the base restrictions, and users do have some responsibility. But, since app developers have to make the most decisions about the data they collect and also make it easy for users to understand, Polonetsky believes that largest weight falls on them. He did say that a lot of developers want to handle user data appropriately but struggle when it comes to how to do so.

Privacy concerns have grown so much in recent months that some action is already beginning to take place. In February, the state of California reached an agreement with all the major mobile platforms including Apple, Google, Research In Motion, Amazon, Hewlett-Packard and Microsoft that require all the apps to provide privacy policies.

More recently at the App Developer Privacy Summit, Joanne McNabb of California’s Office of Privacy Protection announced that the state would issue a set of guidelines for mobile app developers. These rules are expected to be released this summer and will offer advice to app developers on data collection, data sharing, and more.

While Polonetsky thinks these are positive steps in the right direction, he did warn that the government would likely intervene if the problems weren’t addressed.

“App developers – don’t wait for the government to show you what to do,” he said. “I’d rather see the innovators innovate their way out of this and delight people with the way data is used.”

“We have a window,” he went on to say, “but it’s not going to be long that, if we continue to see alarming behavior, we’ll have the serious threat of government regulation.”