Apple: We really don't track our phone users

You may recall that it was a traced cell phone call provided the big break in the hunt for bin Laden.

That same technology could also be used to track anyone through their smart phones. On Tuesday, officials from two of the leading smart phone companies went before Congress to deny that they spy on their customers.

CBS News correspondent Nancy Cordes reports that executives from Apple and Google insisted that the data they gather on their customers' whereabouts is only used to speed up service.

"Apple does not track users' locations. Apple has never done so and does not plan to ever do so," said Guy Tribble, Apple vice president for Software Technology.

A pair of researchers discovered last month that Apple's iPhone stores information on every move its user makes for up to a year, and it's not encrypted, so anyone who gets a hold of your phone can see where you've been. That is a glitch Apple says it is fixing.

The data that's stored in the database is the location of WiFi hotpots and cell phone towers, Tribble said.

Often, those WiFi hotspots are just a few feet awa,y painting a pretty accurate picture of your travels.

"It's really difficult to call this anonymous. Making those claims is not really sincere," said Ashkan Soltani, a technology researcher.

An estimated 72.5 million Americans now own smart phones which they can use to talk, text, shop and surf the web. Many users don't realize that information about their locations, their friends and their preferences can get passed along to third parties to tailor the ads they receive on those phones.

That's also how smart phones provide some of their most popular features, like real time traffic information or local restaurant recommendations.

Google mostly avoided scrutiny today because its popular Android system only stores location data for seven days, and it's encrypted.

Lawmakers say these incidents show that privacy laws haven't kept up with this exploding industry. They'll be introducing a bill this week to give more protections to children who use handheld devices.

  • Nancy Cordes On Twitter»

    Nancy Cordes is CBS News' congressional correspondent.

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