Google and its subsidiary YouTube will pay a fine of $170mn in order to settle down charges imposed by New York Attorney General (AG) and the Federal Trade Commission (FTC). The video streaming service has been accused of collecting personal details from kids without the consent of their parents, announced the FTC on Wednesday.
The company will be paying $136mn to FTC and $34mn to the New York AG. According to the FTC, this is the most significant fine amount it has ever received related to a Children’s Online Privacy Protection Act (COPPA) case.
The FTC and New York alleged YouTube and Google of gathering personal information from kids below 13 years without parent’s consent via specific channels as well as Kids app. The video site allegedly earned millions from utilizing that information to display the targeted advertisements to people viewing those channels.
YouTube used its popularity with kids to garner prospective corporate clients, said Joe Simons, FTC chairman via a statement. Still, when talking about abiding COPPA, the firm declined to acknowledge the fact that sections of its video platform were directed to children clearly, Simons added.
The settlement was passed by the FTC with 3-2 vote. As per the settlement filed, YouTube will have to stop gathering data from the videos which are meant for children. It will also need the creators to identify if their content is meant for children. Additionally, YouTube needs to provide COPPA compliance training annually to its employees that deal with the creators.
YouTube will also have to stop showing personalized advertisements entirely on videos meant for children and turn off notifications and comments on them as well.
According to YouTube, the change would pose a significant business impact on the creators of kids and family content. YouTube said that it would establish a $100mn fund aimed for creation of original, thoughtful kid’s content on its platform globally.