I've come across several apps which allows the user to transfer data (like files, photos, contacts) when they "bump" their phones.
An example is Bump, which use the the bump to transfer files and add friends. The FAQ stated that this app uses various sensors and algorithms to "feel" the bump and the server will find matching bumps according to the sensor reading and algorithms. The FAQ also says that this app was designed with personal and data security in mind.
How exactly does it work? How does it know that I am toasting/bumping with another person? I mean I don't think GPS can track the phones that accurately. And how does it transfer the contacts and photos? And how can it correctly determine who is toasting with whom if there are multiple users in the same room? How is the security and confidentiality protected?