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Computerworld - Between one and four million users of Android phones have downloaded wallpaper apps that swipe personal data from the phone and transmit it to a Chinese-owned server, a mobile security firm said today.

According to San Francisco-based Lookout, a large number of free wallpaper apps in the Android Market scrape the phone number; the user-specific subscriber identifier, also know as the IMSI (International Mobile Subscriber Identity); the phone's SIM card's serial number; and the currently-entered voicemail number from the phone.

That information is then transmitted to a server that Internet records show is registered to a resident of Shenzhen, a city in China's Guangdong province, just north of Hong Kong.

Over 80 wallpaper apps created by a pair of developers -- "callmejack" and "IceskYsl@1sters!" -- include code that accesses users' personal data, said Kevin Mahaffey, chief technology officer and a co-founder of Lookout.

"All that is sent to a Chinese server in clear text," said Mahaffey in an interview prior to Black Hat, where he and CEO John Hering presented findings of what the company called the "App Genome Project," an attempt to analyze the code of some 300,000 applications available in the Android Market and Apple's iPhone App Store.

In a Friday entry on Lookout's blog, Mahaffrey published pieces of the data-scraping code found in the wallpaper apps, as well as an example of the HTML request made to the Chinese server by those programs.

Mahaffrey called the practice "suspicious" but stopped short of calling the wallpaper apps malware or malicious in intent.

"There's no indication that anything malicious has happened," Mahaffrey said before Black Hat. "The wallpaper apps immediately stood out, though, because they were sending the IMSI and phone number. But sometimes developers aren't aware of what's going on with third-party code that they've added to their apps from advertising or analytics SDKs."

Android apps, including the wallpaper programs named by Lookout, require user approval before they're allowed to procure data from the hardware.

On Friday, Mahaffrey cited estimates that put the number of downloads of callmejack's wallpaper apps at between 1.05 million and 4.02 million.

A Google spokesman confirmed that the company is investigating Lookout's allegations, but declined to answer questions about what actions Google might take against the app developers or whether it would pull the programs from the Market.

Unlike owners of Apple's iPhone, people using Android-powered phones can obtain apps from sources other than the Market. Earlier this month, Google said that the Android Market boasts about 70,000 apps.

In a separate briefing at Black Hat, the Las Vegas security conference that ended Thursday, Lookout security researchers showed how hackers could hijack an Android phone by exploiting a known flaw in Linux, the foundation of Android.

Lookout's researchers claimed that they were able to exploit the Linux bug on EVO 4G (Sprint), Droid X (Verizon), and Droid Incredible (Verizon) phones.

In other findings from Lookout's App Genome Project, Mahaffrey claimed that 47% of free Android apps contained third-party code able to interact with and access sensitive information on the phone. Fewer than half as many free iPhone apps -- just 23% by Lookout's measurements -- include similar code.

Typically, that third-party code is dropped into the app by developers when they add analytics and advertising features to their software.

"Oftentimes, the user doesn't know that this kind of information is being sent to the cloud," said Mahaffrey. "We're just trying to make people aware of the capabilities of mobile apps in the wild."

Lookout offers a free-of-charge security app for Android, BlackBerry and Windows Mobile phones that can be downloaded from its Web site.

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld. Follow Gregg on Twitter at @gkeizer or subscribe to Gregg's RSS feed . His e-mail address is gkeizer@ix.netcom.com.

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