YouTube to pay $150 Million to settle FTC allegations

Excerpted from Lexology By Dotan Hammer and Haim Ravia

Most of the FTC’s panel of commissioners reportedly approved a settlement with YouTube who the FTC accused of violating the Children’s Online Privacy Protection Act (COPPA). The FTC alleges that YouTube knowingly collected personal information of children under the age of 13 without parental consent and used it for online advertising aimed at children.

The FTC’s enforcement against YouTube was instigated by a complaint filed by a coalition of privacy advocates, including the Center for Digital Democracy, Consumer Federation of California, Consumer Watchdog, Electronic Privacy Information Center and others. The complaint alleged that 80% of children between 6-12 years of age in the U.S. use YouTube daily and that YouTube has actual knowledge that many children under 12 use its service.

According to the complaint, YouTube collects “geolocation, unique device identifiers, mobile telephone numbers, and persistent identifiers used to recognize a user over time and across different websites or online services”. The complaint goes on to assert that YouTube collects “this information from children under the age of 13, and uses it to target advertisements, without giving notice or obtaining advanced, verifiable parental consent as required by COPPA”. The complaint indicates that YouTube profits from these data activities in two ways. First, by using children’s personal information to target advertising as part of its lucrative ad networks. Second, by profiting from advertising revenues from ads on its YouTube channels that are directed to children.

The coalition’s complaint concludes with a request that the FTC “assess civil penalties that will deter Google from violating COPPA again”, noting that YouTube’s conduct warrants penalties “totaling tens of billions of dollars”.