$170 million FTC-NY YouTube settlement offers COPPA compliance tips for platforms and providers

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Had you asked yesterday, we would have said the largest financial remedy for violations of the Children’s Online Privacy Protection Act Rule was $5.7 million. Today’s $170 million total monetary judgment against YouTube and its parent company Google raises the stakes when it comes to COPPA compliance. Filed jointly with the New York Attorney General’s Office, the record-breaking FTC settlement offers three primary takeaways for other companies.

What Google said about YouTubeHow popular is YouTube with children under 13? The answer YouTube gave depended on who was asking. When pitching its platform to companies selling kid-related products, YouTube described itself as “today’s leader in reaching children age 6-11 against top TV channels” and “the #1 source where children discover new toys + games.” YouTube also touted that it “was unanimously voted as the favorite website for kids 2-12” and that “93% of tweens visit YouTube to watch videos.” Many parents wouldn’t be surprised by that description.

But when an advertiser raised the issue of COPPA, a Google employee said this: “[W]e don’t have users that are below 13 on YouTube and platform/site is general audience, so there is no channel/content that is child-directed and no COPPA compliance is needed.” That statement would likely raise parental eyebrows. And it gets to the heart of where the FTC and the New York AG say YouTube violated COPPA.

Individuals and businesses that upload videos to YouTube can create channels to display their content. Of course, companies want viewers to watch what they’ve uploaded, but YouTube offers another way for businesses to make money through their channels. By default, YouTube enables behavioral advertising (also known as targeted advertising) on monetized channels. That means YouTube collects information about viewers of content in the form of persistent identifiers – for example, cookies that allow YouTube to track viewers over time and across websites – and uses that data to serve them tailored ads. The channel owner makes money from the advertiser and so does YouTube.

YouTube used that money-making model across its platform. That included channels geared to a general audience, but also channels YouTube knew were geared toward kids under 13. How did YouTube know? In some instances, channel owners told YouTube their content was directed to children. In other cases, YouTube’s own rating system identified content as kid-directed. And yet even with that knowledge, YouTube used persistent identifiers on channels directed to children – identifiers that allowed YouTube to track kids online, deliver them targeted ads, and make millions in the process.

Beginning in January 2016, YouTube offered channel owners the option to disable behavioral advertising and instead use contextual ads, a less precise method of anticipating ads to which a viewer might respond. But YouTube cautioned channel owners that turning off behavioral ads “may significantly reduce [the] channel’s revenue.” The unspoken concern was that it also would reduce how much money YouTube would make.

Congress enacted COPPA to make it clear that parents – not marketers – are in charge when it comes to whether companies can collect information from kids online. The FTC and the New York AG allege that YouTube’s behind-the-scenes conduct violated three key COPPA provisions.

First, under the COPPA Rule, a child-directed website or online service – or a site that has actual knowledge it’s collecting or maintaining personal information from a child – must give clear notice on its site of “what information it collects from children, how it uses such information, and its disclosure practices for such information.” Second, the site or service must give direct notice to parents of their practices “with regard to the collection, use, or disclosure of personal information from children.” Third, before collecting personal information from kids under 13, COPPA-covered companies must get verifiable parental consent. COPPA’s definition of “personal information” specifically includes persistent identifiers used for behavioral advertising. Importantly, third-party platforms are subject to COPPA when they have actual knowledge they’re collecting personal information from users of a kid-directed site. Therefore, the complaint charges that YouTube knew certain channels on its platform were directed to children and yet tracked visitors to those sites without disclosing that practice and without getting parents’ verifiable consent.

YouTube changes as a result of caseIn addition to the $170 million judgment – which goes to the U.S. Treasury and the State of New York – the proposed settlement requires YouTube and parent company Google to notify channel owners that their child-directed content may be subject to the COPPA Rule. YouTube and Google also must implement and maintain a system that lets channel owners identify content as child-directed so YouTube can ensure it’s complying with COPPA. In addition, YouTube and Google must provide annual COPPA compliance training for employees who deal with channel owners.

What tips can other companies take from the settlement?

Content creators need to be conversant with COPPA. Do you upload child-directed content to platforms like YouTube for commercial purposes? The COPPA Rule may apply if you allow the collection of personal information from viewers of your content. That includes the collection of persistent identifiers used for behavioral advertising.

A warning to platforms: Actual knowledge that content is kid-directed kicks in COPPA obligations. If a platform hosting third-party content knows that content is directed to children, it’s illegal to collect personal information from viewers without getting verifiable parental consent.

Like real estate, a website can be “mixed use.” It’s fine for most commercial sites geared to a general audience to include a corner for kids. But if that part of your site collects information from users, you now have obligations under COPPA.

Check the Business Center’s COPPA portal for compliance resources.
 

Comments

As a parent and a youtube creator, this decision was made hastily and with hazy language with far too harsh penalties. Clarity of language would help a lot to ease tensions. But no real qualification of terms have been submitted by the FTC. This can be done better.

From what i understand in the faq if you make a site or service intended for people over 13 and kids under 13 use it, your intentions and what you want dont matter and you are considered as aiming at kids. I dont see anything about videos in the faq but i assume it would fall under services section.

So what i gather from this is your intent does not matter. if kids gather to watch your videos your videos are aimed at kids. This seem rather unfair as many people under 13 have youtube accounts (in violation of youtubes tos) so even making your video age restricted does not save you from this and in the long run just makes being a content creator on youtube no longer viable as age restricted videos get little to no ads.

People uploading and streaming videos need more clear cut and concrete lines of what they can do to make sure they stay kid friendly or not kid friendly. As of now it seems like the ftc gets to say what is geared towards kids and what is not, not matter what the person making the content says it is.

That doesn’t really mean anything when you have the power to end an person life. Please change the rules for YouTubes the ones that depend on YouTube to live.

^ ya. I watch many youtubers some that are child friendly and some that aren't child friendly. I would not want to see this disappear. plus people have this as a job. I have wanted to pursue a career on YouTube for a long time. These are just too harsh. sure what google did was wrong taking children's information. But the Creators should not be taking the blame. People have dreams, many. But you are standing in the way. You are that one kid in class that does something bad but the whole class gets in trouble. Also part of this goes to the parents. They should be taking more responsibility for their children. I'm subscribe to 200 youtubers. A majority of these YouTube are family friendly and haven't down anything wrong but what happens, they get in trouble, they have a hard time working already. We have dreams, we have a tomorrow, but you are trying take that tomorrow away. This is harming many people physical and mentality. The only thing this is going to do is create bigger problems. A platform that has more than 1 million people using a day, those people find it as a way to escape hard life. YouTube help me when I was in a real bad depression and partly suicidal. Many other people have these same problems.

There is a very large community of adults who collect toys -- especially action figures. There are many YouTube channels dedicated to this hobby, and the creators of these channels are understandably nervous about being forced to shut down if their work is incorrectly perceived to be aimed at kids. It would be great if the FTC could make it clear to YouTube that channels created for adult collectors will not be in violation of COPPA.

I agree, I'm a YT creator who collects toys and the FTC needs to comment on this

This Decision is wrong. They are forcing good Content Creators their lives. So Many YouTube Channels are going to be shut down because of this. It's like they don't think about the Youtube creators at all. Where are they supposed to go when you force them to shut down their channel.

Coppa is great in protecting children from adult web content on YouTube and other media sites. Parents have to step up and make sure their under age children don’t see adult content ,because there are too many parents ignoring this issue.

Finding each YouTuber $42,000 dollors PER VIDEO is unexpectable and ridiculous. Many small youtubers, like myself, don't have that kind of money. Therefore I, myself, believe that this is unexplainable and out of reach. Many youtubers could end up homeless from all of the fines that the FTV is sending them. There is a such thing called as "YouTube Kids" that automatically filters through all of the channels and state if the channel and videos are kid friendly or not. Some youtubers are are in grave danger and have thousands of videos and if they are find for every single video they have, they will most likely end up homeless. Yes COPPA is keeping kids safe, and yes COPPA is saving kids every day, yet this fine for the youtubers and youtube itself is very unreasonable and out of reach for many people. Thanks for your time reading this.

I believe this rule is incredibly strict on content creators. If a creator were to make a video that was marked as for children basically inaccessible. No notifications would be received, nobody can search it, and it wouldn’t be recommended. How would you see the video? Even if you do, the creator would get basically nothing. In conclusion, this law is incredibly strict on creators and needs to stop.

This act asserts more control than necessary. I do not comply disagree with the act but there should be a revision that forwards changes to this. There should be relaxation in control over what viewers see and what they can do on the sites. I think I speak for many people when I say that this needs to change. I have seen public outrage on the rule that are to be laid down and content creators that are intimidated by these rules that are to be put into place.I've seen people destroy their channels and what they have worked on so hard because of this. I would like to end with Please change theses rules.

The comments you put here on the Business Blog do not go on the public record. If you want to make a comment on the public record, you have until December 9, 2019. Read about the COPPA Rule. Submit a Comment to the public record here.

Hey there, this policy will do more harm that good, especially for communities such as animators. The COPPA directives at what constitutes kid directed content are far too vague to apply to individual videos over entire websites. Things such as "animated characters and language kids can understand" could apply to any number of videos that are even explicitly made for adults. Comments are not just methods of collecting data- they provide valuable feedback, encouragement and I can't say how many times my day has been brightened by a comment saying they love my content. Creators know better than anyone else if our content is made for kids, yet we don't have a choice in marking our content, as youtube's algorithm can override it. Ultimately, creators should not have the responsibility to make things safe for kids placed on us, and many of us are minors ourself or struggling and we cannot afford the kind of fines that are being threatened. There are so many better solutions and please consult creators, the people who will be effected most instead of relying on legislation that was made for a very different internet. This action will put people out of work and kill thriving online communities. Please, please reconsider.

Ironic, these new rules say video games are a "for kids" topic, but gov officials still rush to say that they cause violence and are not for kids Laws needs concrete wording and specifications, not broad reaching generalizations

I'm just shocked and awe of thisactually happening,I just want anyone who's reading this and whoever organized this it will ruin not only YouTube but me as a channel.I've worked hard as a content creater for 2 years and I don't want all that hardwork be for nothing, I'm emotionally upset about this policy this is something that'll ruin everything I've always dream of becoming to help others and be there for everyone I care about because thats the person I am, YouTube has taught me alot as a member of society with very helpful people making an impact on my life to turn me into a better man, if anyone is reading this if anyone is hearing me out of what I have to say please this law will make things far more worse then it already,I hope in your heart you can find a way to fix this solution without the use of this policy this is Henry Gonzales a college student who speaks from the heart.

Dont take away youtube videos i love youtube I people spend money to post content and people take time to make videos for peoples likening just for you guys to take it all away!

Kid channels are important to the younger Society you are basically making the kids watch things they shouldn't watch and what about kids songs or nursery rhymes for babys please keep YouTube as it is please and thank you

If youtube is gone jauery 1 2020 it will ruin a lot of kids and creators is a job and it will make them jobless. It is bad to sue the creators and youtube.

The YouTube crafting community is in a panic. Most do not create videos targeted to children. They believe that if they do not say the videos are child directed (and lose the little money they get) they could be slapped with a $42k fine for each video when the FTC does a ‘sweep’. This seems to be well outside the intent of the law. Those using the platform are not collecting information, YouTube is collecting pattern info. So what is the real process if a channel or video is determined to be child directed/attractive by FTC but not so marked? Will they get A warning? Can they appeal? What is that process? These are retired teachers, crafters and artists doing videos of how to do what they do and clearly they are alarmed. We do not want to lose these creators but the info provided does not answer these questions. Totally for child protection, but can you please do a little more to be clear to the good guys before we lose them? Thank You!

this issue isn't something to punish the Youtubers on. these regulations and rules are way to difficult to adhere to and when people aren't able to the punishment is way to harsh. 42,000 dollars per video that has child friendly stuff in it, along with any bright color in the video or thumbnail? that is just ridiculous. this has taken it way to far.

This is what I don't understand. Why should Youtube content creators be held accountable for Youtube's alleged screw up?

Did they forget about YouTube kids?YouTube kids is for kids under the age of 13 and YouTube is for 13 and up.

No one is clarifying anything. If I produce adult only content about toys/collectibles/LEGOs/ plastic model/ model airplanes/model trains etc for my YouTube channel, and I mark it as adult only, will the FTC interpret this as “appealing to children” No one at the FTC who developed this language as given any clarification to YouTube creators on this subject. This decision was made by people who don’t understand small creators, and were only thinking about million dollar corporations

I'm extremely concerned as to how much responsibility you are putting on to the creators. When there are some that want to make content actually for kids, and content for people 14 and older, how do you actually know because the concept of what is "for kids" has changed a lot. Say government made youtube channels show issues that garners interests for kids 13 and younger. Will this a lawsuit for the government for themselves?

Parents need to be responsible for what their kids watch not making content creators that kids happen to like watch out what they have to make because the idea is ridiculous and you wording makes the law too vague, confusing, and out of date as to what targets kids.

Now if this comment gets responded, I am curious if the responder will point me towards one of a public forum links while avoiding the issue. Because it feels as if no one researches the issue.

Honestly think other sites made for kids don't do the same thing or those that have an EXTREMELY mixed demographic.

Once again do research and make an educated decision about this COPPA ruling. it is not the entertainers fault he entertains to all ages.

This is so dumb why is YouTube fault children sign up and use it when it clearly says you must be over 13 to sign up they have no control over children that lie and say they're over 13 when they're actually not

This is stupid

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