Disney to pay $10M to settle FTC claims over child data collection

Disney (DIS) will pay $10M to settle Federal Trade Commission allegations that the company 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. The proposed order would transform how the entertainment behemoth designates videos on YouTube as “Made for Kids,” while encouraging adoption of age assurance technologies on YouTube. A complaint, filed by the Department of Justice upon notification and referral from the FTC, alleged that Disney Worldwide Services, Inc. and Disney Entertainment Operations LLC violated the COPPA Rule by failing to properly label some videos that it uploaded to YouTube as “Made for Kids.” The complaint says the mislabeling allowed Disney, through YouTube, to collect personal data from children under 13 viewing child-directed videos and use that data for targeted advertising to children. Disney receives a portion of the revenues that YouTube generates from advertising placed with Disney videos and revenues from advertising that Disney sells directly. The mislabeling also exposed children to age-inappropriate YouTube features like autoplay to videos not “Made for Kids.”