YouTube fined for violating kids privacy law

Google’s video site YouTube has been fined US$170 million to settle allegations it collected children’s personal data without their parents’ consent.

The Federal Trade Commission, FTC fined Google US$136 million. The company will pay an additional US$34 million to New York state to resolve similar allegations.

The fine is the largest the agency has levelled against Google, although it is tiny compared with the US$5-billion fine the FTC imposed against Facebook this year for privacy violations.

The FTC has been investigating YouTube for the way it handles the data of kids under 13. Young children are protected by a federal law that requires parental consent before companies can collect and share their personal information.

YouTube has said its service is intended for ages 13 and older, although younger kids commonly watch videos on the site and many popular YouTube channels feature cartoons or singalongs made for children.

The FTC’s complaint details Google’s mixed messages about who the site is geared for, and includes as evidence Google presentations made to toy companies Mattel and Hasbro, where YouTube is described as the “new Saturday morning cartoons” and the “#1 website regularly visited by kids”.

“YouTube touted its popularity with children to prospective corporate clients,” FTC Chairman Joe Simons said in a statement. Yet when it came to complying with the law protecting children’s privacy, he said, “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.”

YouTube has its own app for children, called YouTube Kids. The company also launched a website version of the service in August. The site says it requires parental consent and uses simple math problems to ensure that kids aren’t signing in on their own.

YouTube Kids does not target ads based on viewer interests the way the main YouTube service does. The children’s version does track information about what kids are watching in order to recommend videos. It also collects personally identifying device information.

A coalition of advocacy groups that last year helped trigger the FTC’s investigation, said in a joint statement Wednesday that the outcome will reduce the amount of behavioural advertising targeting children. But they say it doesn’t go far enough to hold Google accountable.

“We are gratified that the FTC has finally forced Google to confront its long-standing lie that it wasn’t targeting children on YouTube,” said Jeff Chester, executive director of the Center for Digital Democracy. But he said the “paltry” fine sends a signal that politically powerful corporations don’t have to fear serious consequences for breaking the law.

Indeed, the fine will barely dent Google’s finances. Google’s parent company, Alphabet, made a profit of US$30.7 billion on revenue of US$136.8 billion last year.

AP