App Neon Mobile Tops Apple’s U.S. Social Networking Chart Amidst Privacy Concerns for Selling Users’ Recorded Phone Calls to AI Companies

A mobile application, Neon Mobile, has surged to become the second most popular social networking app in Apple’s US App Store. The app promises to pay users for their phone call recordings, which it then sells to AI companies for developing and improving artificial intelligence tools.

Neon Mobile claims to offer significant earnings potential, with 30 cents per minute for calls made to other Neon users and up to $30 daily for calls to other contacts. The app also offers incentives for referrals. Since its initial ranking of 476 in the U.S. App Store’s Social Networking category on September 18, the app has climbed to the No. 2 position in the top free charts for social apps, according to data from app intelligence firm Appfigures.

Neon Mobile’s terms of service outline that the app can capture both inbound and outbound phone calls, although the company claims it only records users’ side of the conversation unless they are speaking with other Neon users. The recorded conversations are then sold to AI companies for various purposes, including developing, training, testing, and improving machine learning models and artificial intelligence tools.

However, the terms of service also include a broad license for user data, allowing the company to sell, use, host, store, transfer, publicly display, publicly perform, communicate to the public, reproduce, modify, create derivative works, and distribute recordings in whole or in part, in any media formats and through any media channels. This leaves room for Neon Mobile to utilize users’ data beyond what it claims.

The app also includes an extensive section on beta features, which come with no warranty and may have various issues and bugs. Despite these concerns, the app’s legal status remains unclear.

Legal experts argue that recording only one side of a phone call is a strategy to avoid wiretap laws, as consent from both parties is typically required for recording conversations under state laws. However, there are also concerns about the anonymity of the data sold to AI companies. Neon Mobile claims it removes users’ names, emails, and phone numbers before selling the data, but it remains unclear how its partners or clients could use the voice data without compromising user privacy.

Voice data could potentially be used for creating fake calls that appear to originate from the user, or for developing AI voices based on the user’s voice. Moreover, Neon Mobile does not disclose its trusted partners or their permitted uses of users’ data, and the company is subject to potential data breaches like any other company with valuable data.

In a test by an unnamed publication, the app did not indicate it was recording the user’s call, nor did it warn the call recipient. The app functioned similarly to any other voice-over-IP app, and the caller ID displayed the inbound phone number as usual. It remains to be seen whether Neon Mobile can maintain its popularity amid concerns about privacy and data security.