Mobile Users Remain Safe (Mostly) in 2013, Lookout Says

Malware is mainly a problem for users in Russia and China, while lost and stolen devices will cost U.S. consumers.

In 2013, mobile users will mainly have to worry about lost and stolen devices, an increase in spam messages, tracking by applications and dealing with security-conscious employers. Malware will continue to be a minor threat for users in the United States, Canada and Western Europe, according to the latest report from mobile-security firm Lookout.

Only 18 million users will encounter malware in the two years ending Dec. 31, 2013—mostly in China, Russia, former Eastern bloc countries and Saudi Arabia, according to the company's report. In other countries, the incidence of malware is much lower, less than 1 percent. The likelihood that a user in Japan encounters malware is 0.2 percent, and 0.4 percent for U.S. users, while mobile users in Russia had a 35 percent chance of encountering a malicious program.

"It is highly geographically dependent in terms of what threats you might be exposed to," said Derek Halliday, senior product manager at Lookout. "In particular, there is one type of threat that accounts for most of these infections, and that is toll-fraud malware."

Toll-fraud malware uses its access to a compromised device to send messages to premium services. It currently accounts for 72 percent of the malicious software blocked by Lookout. Trojan applications, and fake installers are still the most common way to spread malicious software. While the latest version of Android has protections to prevent toll fraud, phones using the new operating system will not heavily penetrate the market in 2013, the company said.

Overall, a new Lookout user only had a 0.84 percent chance of encountering malware, the firm said.

A number of other threats will target users far more frequently: Lost and stolen devices will cost U.S. consumers $30 billion in 2012, and nearly 40 percent of users will have to deal with a malicious link, the company estimated. In addition, software that uses advertising networks to aggressively collect information on users accounted for 5 percent of all downloads, the report stated.

"Privacy is a big issue," Halliday said. "And privacy stretches across the application space, regardless of the store that you download your app from."

Because they are more likely to track information about users, free applications are, ironically, far more likely to have a privacy policy. About 70 percent of free mobile apps have a privacy policy, compared with 53 percent of paid apps, according to a June report from the Future of Privacy Forum (FPF). On Dec. 10, the U.S. Federal Trade Commission found that 60 percent of mobile apps aimed at children were communicating information to a developer or an ad network, but only 20 percent adequately disclosed the fact in a privacy policy.

Lost and stolen phones continue to be a problem. People are most likely to leave their phones in a coffee shop, at a pharmacy or in church, Lookout found in an earlier report. Most phones are lost in the United States, Canada and the United Kingdom.