Disney to Pay $10M for Illegally Collecting Kids’ Data on YouTube
▼ Summary
– Disney will pay $10 million to settle FTC allegations that it illegally collected children’s personal data on YouTube by mislabeling videos.
– The FTC claims Disney failed to individually mark kid-friendly videos as “Made for Kids,” instead using a default channel-level setting that avoided YouTube’s stricter privacy rules.
– This mislabeling allowed Disney to collect data on children and serve them targeted ads, violating the Children’s Online Privacy Protection (COPPA) Rule.
– YouTube had previously informed Disney in 2020 that over 300 videos were incorrectly labeled, yet Disney continued using the default channel-level designation.
– As part of the settlement, Disney must obtain parental consent for data collection, implement a video review system for ten years, and may stop if YouTube develops its own age-determination system.
In a significant settlement over digital privacy violations, Disney has agreed to pay $10 million to resolve Federal Trade Commission allegations that the entertainment giant improperly labeled children’s content on YouTube, enabling the illegal collection of personal data from young viewers. The case centers on the company’s failure to correctly identify videos featuring popular animated characters, a misstep that allowed targeted advertising to reach underage audiences without parental consent.
According to the FTC, Disney uploaded numerous videos containing content from well-known family films such as “The Incredibles,” “Toy Story,” and “Frozen” but incorrectly marked them as “Not Made for Kids” at the channel level. This designation bypassed YouTube’s stricter privacy protections for child-directed content, which include restrictions on data collection and personalized ads. As a result, the platform was able to gather information from young viewers and serve them targeted advertisements, a direct violation of the Children’s Online Privacy Protection Act (COPPA).
COPPA mandates that companies must obtain verifiable parental consent before collecting any personal information from children under the age of 13. By mislabeling the videos, Disney effectively sidestepped these requirements. The FTC further noted that YouTube’s own automated systems sometimes autoplayed additional content not intended for children after these Disney videos concluded, compounding the exposure of young users to inappropriate tracking and marketing.
This is not the first time YouTube has been at the center of COPPA-related enforcement. The platform itself settled with the FTC in 2019 over similar accusations, leading to the implementation of the “Made for Kids” labeling system Disney is now accused of circumventing. The government contends that Disney was aware of the mislabeling issue as early as 2020, when YouTube proactively reclassified more than 300 Disney videos from “Not Made for Kids” to the correct “Made for Kids” designation. Despite this warning, Disney continued to use channel-level default settings rather than reviewing and labeling videos individually.
As part of the proposed settlement, Disney must not only pay the multimillion-dollar penalty but also establish a comprehensive compliance program. This includes implementing a system to review all future YouTube uploads to ensure proper age-based labeling, a requirement that will remain in effect for the next decade. However, the obligation may be lifted if YouTube develops its own reliable age-verification mechanism for all users. Until then, Disney is required to adhere strictly to COPPA guidelines and secure parental permission before gathering any data from children under 13.
(Source: The Verge)
