An Empirical Investigation of the Antecedents and Consequences of Privacy Uncertainty in the Context of Mobile Apps

Abstract

When using mobile apps that extensively collect user information, privacy uncertainty, which is consumers’ difficulty in assessing the privacy of the data they entrust to others, is a major concern. Using a simulated app-buying experiment, we find that privacy uncertainty, which is mainly driven by uncertainty about what data are collected and how they are used and protected, is indeed a significant influencer of one’s intentions to use a mobile app and the perceived risk associated with that use, as well as the price a potential consumer is willing to pay for an app. Our results further show that the uncertainty concerning the data collected while using a mobile app drives consumers’ decisions more than the uncertainty regarding data that are collected at the time an app is downloaded. To investigate whether privacy uncertainty continues to be a factor after a consumer has already started using an app, we conducted a survey of users of wellness and personal finance apps. The results indicate that privacy uncertainty is a lingering concern because it continues to influence a user’s intention to continue using an app and the perceived risk associated with that continued use.