The software secretly installed on millions of cell-phones is spying on users, reading their text messages and monitoring every keystroke, according to a mobile applications developer, who has published evidence online.

­Trevor Eckhart, 25, an Android app developer from Connecticut, has published what he says is conclusive proof that millions of smartphones are secretly monitoring keystrokes.

The video he posted on YouTube shows how a software package from a Silicon Valley company known as Carrier IQ reads private text messages and online search requests, records keystrokes and sends the information back somewhere, presumably the company.

“Every button you press in the dialer before you call,” Eckhart says, “it already gets sent off to the IQ application.”

In his 17-minute video, Trevor shows his phone connected to a computer, explaining step-by-step his revelations.

Though the software is installed on most modern Android, BlackBerry and Nokia phones, Carrier IQ was virtually unknown until Eckhart analyzed its workings.

However, the company denies that its software is designed to spy on users. Carrier IQ earlier tried to suppress Eckhart's report.

The video was published four days after Carrier IQ called off its threats of legal action and claims of monetary damages. Earlier Trevor Eckhart raised the ire of a company by labeling the software a “rootkit”. He said that the description suited the software well because, he says, it is made the way so that it hides its presence, avoiding operating system’s typical functions.

The Electronic Freedom Foundation, an activist group which promotes free speech online, supported Eckhart, and the Carrier IQ was forced to back off on its threats.