It’s called Carrier IQ, and it can see everything your phone does. Sprint has denied the program records and sends your information, but then, they also denied the program could do what it’s already been shown to do. The researcher who discovered the program was hit by a Cease & Desist order, but that was retracted after the EFF got involved. Is your phone safe, and what can you do about it? TechCrunch has the story.
The only way to be sure your electronics are clean from spyware and malware is to have complete access to the hardware. Companies are fighting hard to prevent you from having that access, and programs like Carrier IQ are exactly why. Your personal information is valuable, and if corporations can’t just steal it from you, why, they might have to actually pay you for it or even, gasp, not be allowed to collect it at all.