Japan’s Milog Builds Business Around Selling User Data, Angers Android Users

Applog Knows Its Users App Habits

Milog, a Japanese startup focused on Android development, has recently been the recipient of much negative attention regarding its sneaky business tactics. What’s interesting is that Milog was the focus of similar attention and accusations for their actions just months ago. While most companies would correct their practices Milog has instead shed other aspects of their business and focused solely on what has angered its Android users. In turn the young company has garnered support from Mediba, a major mobile advertising company owned by KDDI.

To fully appreciate the current situation and the activities which are causing so much controversy it is important to start from the beginning.

Milog spent the last several years building apps and services, receiving moderate public reception. On multiple occasions the company was recognized as a runner-up at the biannual Infinity Ventures Summit (2009, 2010). But in time, for one reason or another, the apps and services Milog has developed have been abandoned. Most recently this was the case for App.tv.

App.tv was an Android app launched in July 2011 that allowed users to watch anime on their smartphones. Unbeknown to hundreds of its users, the app was secretly sending information about the user back to Milog. This information included logs of the other apps installed on the phone and the frequency of app use. Milog then sold this data to advertisers without the users’ permission. The company’s activities were discovered, the president apologized, and the app was shut down in September October.

Now only weeks later the company is bouncing back with its next effort. But have they learned their lesson? Well, yes and no.

Milog has recently released its service called Applog. In essence it is the spying technology developed for App.tv but repackaged as an SDK for other developers to implement in their apps. If all goes as planned other developers will insert Milog’s code into their apps which will spy on users on the behalf of Milog and advertisers. While Milog is ignoring user complaints, this time the company is legally sound as it asks for users’ permission before sending personal information.

Applog collects users’ data and shares it with advertisers

Milog’s effort this time around is more transparent than with App.tv. The Applog website attempts to appeal to all parties involved (users, developers, and advertisers), although the pitch to app users is understandably weak. Developers are enticed by a monthly payout of one yen per month for each app with the Applog code in use. So an app that has 100 users that give Applog permission to gather user data will garner the developer 100 yen per month from Milog.

The biggest beneficiaries are the advertisers, specifically KDDI’s wholly owned subsidiary, Mediba, who will have access to users’ personal data. Mediba will be able to see the phone model, OS, a list of downloaded apps, and the frequency of these apps’ use. Milog also pitches that advertisers will be able to determine the age and gender of the user. This information is worth paying for and will be presumably be Applog’s main source of revenue.

Milog compels app users to give sharing permission to developers in an appeal to indirectly financially support the developers. As the pitch on the Applog website goes, developers will be more inclined to keep their apps free if users agree to share their data.

In the end, despite the bad press and online uproar (see big red comments screaming “Spyware!”) Applog is an opt-in service. Those opposed to the service can always deny permission and continue to use their apps as is.

[Images via Milog and Asahi]