Just days after a sensationalist report by the LA Times suggested that Apple was spying on users’ location based on an incorrect understanding of the company’s revised privacy policy, two Congressmen, one a chair of the House Privacy Caucus, have demanded that the company answer a series of basic privacy questions.

The original report by David Sarno of the LA Times set off a firestorm of privacy panic three days ago after it suggested Apple was tracking iPhone users’ locations in some radical new way that other devices weren’t, and assumed that users were powerless to do anything about it…

The report has since been amended twice, once to note that users can turn off Location Services entirely or on a per-app basis, while also stating “there’s nothing to indicate that these settings prevent Apple itself from gathering and storing location data from Apple devices,” and again two days later to acknowledge that the privacy policy change is not really new at all, but rather simply a restatement of the privacy policy contained in the company’s product EULAs, which contained precise language instructing how users can withdraw their consent for system wide and per-app data collection.

What the LA Times failed to report is why the change in presenting the privacy policy was made, and how users can opt out of geographic location data used by Apple’s iAd program. Formerly, Apple and third parties used Location Services solely to power features such as locating the device in Maps, Find My Phone, GPS driving directions, and similar applications. With the company’s purchase of Quattro Wireless, it’s now in the business of display advertising, and can potentially allow third parties to collect geographic and other user information to enable ads to provide more relevant and targeted results.

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