Disney has agreed to pay $10 million to settle a complaint alleging that the company collected children’s personal data, violating the law.
According to the Federal Trade Commission (FTC), Disney “allowed personal data to be collected from children who viewed kid-directed videos on YouTube without notifying parents or obtaining their consent as required by the Children’s Online Privacy Protection Rule (COPPA Rule).” Under the proposed order, Disney must change how it designates videos considered “Made for Kids” and encourage age-appropriate technology on YouTube.
The complaint, filed by the Department of Justice, argued that Disney violated the COPPA Rule by failing to properly label videos. The mislabeling allowed the company to collect data from children under the age of 13 and use the data for advertising.
“Disney’s failure to accurately designate child-directed videos as [Made for Kids] results in YouTube collecting personal information and placing targeted advertisements on child-directed videos on Disney’s behalf,” the complaint stated, noting that “at least twelve different ad campaigns with over 350,000 ad impressions ran on these MFK channels.”
Disney had been asked to change its designations for videos in 2020.
“This case underscores the FTC’s commitment to enforcing COPPA, which was enacted by Congress to ensure that parents, not companies like Disney, make decisions about the collection and use of their children’s personal information online,” FTC Chairman Andrew Ferguson said in a statement. “Our order penalizes Disney’s abuse of parents’ trust, and, through a mandated video-review program, makes room for the future of protecting kids online—age assurance technology.”
