Google and YouTube will pay a $170 million fine to settle allegations…
YouTube and its parent company Google will pay a record $170 million fine to settle allegations made by the Federal Trade Commission and the New York Attorney General.
The charge? That YouTube illegally collected personal information from children. The allegations cite YouTube’s failure to get parental consent before collecting this information, which violates the Children’s Online Privacy Protection Act (COPPA) Rule.
The settlement, which was revealed on Wednesday, requires Google and YouTube to pay a $136 million fine to the FTC and a $34 million fine to New York. To date, this is the largest fine the FTC has imposed against Google.
Following the announcement, shares of Alphabet, Google’s parent company, were up by about 0.8%.
FTC Allegations
The FTC and the New York Attorney General allege that YouTube violated the COPPA Rule by neglecting to get parental consent before collecting personal information from children. YouTube reportedly then earned millions of dollars by using this information to deliver targeted ads to viewers of child-directed YouTube channels.
In the press release published by the FTC on Wednesday, chairman Joe Simons said, “YouTube touted its popularity with children to prospective corporate clients.” He continued, “Yet when it came to complying with COPPA, the company refused to acknowledge that portions of its platform were clearly directed to kids. There’s no excuse for YouTube’s violations of the law.”
The allegations insist that even though YouTube claims to appeal to general audiences, certain YouTube channels are directed toward children. As such, the site is required to comply with COPPA.
The complaint argues that YouTube previously marketed itself to makers of popular children’s products as a popular destination for children. And in certain instances, YouTube’s own content rating system identified specific content as being directed to kids.
Despite this, YouTube continually delivered targeted advertisements to channels aimed at children.
Additional Settlement Terms
In addition to the $170 million fine, the settlement, which passed in a 3-2 vote, requires YouTube and Google to create and implement a system that allows channels to identify their child-directed content so that YouTube may comply with COPPA.
YouTube must also notify these channels that their content may need to comply with COPPA, and provide employees who deal with YouTube channel owners annual training on COPPA compliance.
Last, Google and YouTube must not violate COPPA, must be transparent about their data collection practices, and obtain verifiable parental consent prior to collecting identifying information from children.
YouTube Addresses Concerns
In a blog post published on Wednesday, YouTube revealed that it’s taking steps to address concerns regarding its privacy and data collection practices.
The company stated, “From its earliest days, YouTube has been a site for people over 13, but with a boom in family content and the rise of shared devices, the likelihood of children watching without supervision has increased.”
YouTube continued that it “will limit data collection and use on videos made for kids only to what is needed to support the operation of the service,” and will “stop serving personalized ads on this content entirely.”
The company also recommended that parents use YouTube Kids if they plan to let children under the age of 13 view content independently.
