Warranted or not, the controversy over Carrier IQ's software is affecting its business.
Sprint has decided to remove the technology from its software through a series of over-the-air updates after disabling it last month because of "customer concerns," a company spokeswoman said.
"As we are no longer using the tool, we have decided to remove Carrier IQ from all devices through a maintenance release process," she said in an email.
According to tech blog AndroidCentral, the HTC Evo 4G, the Samsung Epic 4G and the Evo Design 4G will be the first of the operator's smartphones to have the software removed. Sprint did not confirm that report.
AT&T and T-Mobile USA, which also use Carrier IQ, could not be immediately reached for comment on whether they would also stop using the software. Verizon Wireless does not use Carrier IQ.
AT&T uses the technology on about 900,000 devices. T-Mobile has not disclosed how many of its phones come loaded with Carrier IQ's software.
Carrier IQ found itself at the center of the controversy in November after security researcher Trevor Eckhart published a report claiming that Verizon and Sprint used the company's software to track the location and usage history of smartphone subscribers without their knowledge.
Verizon denied using the software at all, and Sprint said it only used the software to pinpoint trouble spots on its network, but the Internet uproar over the report eventually prompted Sprint to abandon the software.
Carrier IQ maintains that it only collects the information it needs to troubleshoot problems with devices and network performance, but its critics say that the preloaded software violates users' privacy and could possibly break federal wiretapping laws. The software collects anonymized data on the performance of individual cell phones and can be used to log a device's location during a dropped call, among other things.
The debate about whether the software violated users' privacy rights drew the attention of Democrat Sen. Al Franken from Minnesota in December. Carrier IQ is also facing two class-action lawsuits over the matter.
Carrier IQ did not reply to an interview request by press time, but the loss of Sprint as a customer could be a blow for the privately traded start-up. Sprint's smartphones alone comprise more than one-eighth of the total 150 million devices worldwide that Carrier IQ says are preloaded with its software.