Google’s YouTube will pay $170 million to settle allegations that it broke federal law by collecting personal information about children. Democrats criticized the settlement.
Google’s YouTube had been accused of collecting data through cookies and tracking viewers of children’s channels without parental consent and using those to target millions of dollars in ads, it clearly violates privacy law.
The settlement with the FTC and the New York attorney general’s office, which will receive $34 million, is the largest since a law banning collecting information about children under age 13 came into effect in 1998.
The law was revised in 2013 to include “cookies,” used to track a person’s internet viewing habits.
It is also small compared with the company’s revenues. Alphabet, which generates about 85% of its revenue from sales of ad space and ad technology, in July reported total second-quarter revenue of $38.9 billion.
YouTube said in a statement on August 4 that in four months it would begin treating all data collected from people watching children’s content as if it came from a child.
Today we’re sharing several changes designed to better protect data on children’s content on YouTube. Starting in about four months:— YouTube (@YouTube) September 4, 2019
“This means that we will limit data collection and use on videos made for kids only to what is needed to support the operation of the service,” YouTube said on its blog.
In addition to the monetary fine, the proposed settlement requires the company to create a system for identifying content aimed at children.
It also proposed to notify channel owners about their obligations to get consent from parents before collecting information on children.
FTC Chairman Joe Simons at a news conference on August 4, what he said were important changes to YouTube business practices. The settlement requires Google’s YouTube to create a policy about children’s privacy.
“No other company in America is subject to these types of requirements and they will impose significant costs on YouTube,” he told reporters.
FTC’s Bureau of Consumer Protection director Andrew Smith told reporters that the $170 million settlement was based on revenues from data collected, times a multiplier.
“It happens that $170 million is roughly the budget of the Bureau of Consumer Protection for one year,” he added.
Furthermore, after the settlement takes effect, the FTC plans to “conduct a sweep of the YouTube platform to determine whether there remains child-directed content” in which personal information is being collected, Smith said.
Most noteworthy, the FTC could take actions against individual content creators or channel owners as a result.
YouTube Kids launched in August
Moreover, recently YouTube launched its new product YouTube Kids with separate niches for children depending on their ages and designed to exclude disturbing videos and behavioral advertising.
On the other hand, in its complaint, the government said that YouTube touted its popularity with children in marketing itself to companies like Mattel and Hasbro.
Also, New York Attorney General Letitia James said the companies “abused their power.”
The government told Mattel that “YouTube is today’s leader in reaching children age 6-11 against top TV channels,” according to the complaint.
“Google and YouTube knowingly and illegally monitored, tracked, and served targeted ads to young children just to keep advertising dollars rolling in,” said James.
Democrats criticized the settlement with YouTube
The two Democrats on the FTC; Rebecca Slaughter and Rohit Chopra dissented from the settlement.
Slaughter, who called the violations “widespread and brazen,” said the settlement fails to require YouTube to police channels that provide children’s content but do not designate it as such, thus allowing more lucrative behavioral advertising, which relies on tracking viewers through cookies.
Most importantly, Senators Ed Markey and Richard Blumenthal, both Democrats active in online privacy matters, criticized the settlement in separate statements.
“A financial settlement is no substitute for strict reforms that will stop Google and other tech companies from invading our privacy,” Blumenthal said.
“I continue to be alarmed by Big Tech’s policies and practices that invade children’s lives,” he added.
YouTube purges 17,000 hate speech channels after policy change
The tech giant YouTube this week issued an update on its efforts to remove hate speech from its platform and it would appear it’s managed to make some headway.
Google’s YouTube claims to have removed over 100,000 videos and 17,000 channels specifically over hate speech, which is both good and kind of terrifying when you think about it.
The hate speech policies changed earlier this year, with YouTube “specifically prohibiting videos alleging that a group is superior in order to justify discrimination based on qualities like age, gender, race, caste, religion, sexual orientation or veteran status.”
It also added that it would be removing videos glorifying Nazi ideology, and those that denied “well-documented violent events” like Sandy Hook or the Holocaust.
Many have complained about YouTube’s slipshod approach to policing its platform.
Sundar Pichai defends Google’s Youtube practices
Google and YouTube executives have in the past attempted to defend the site’s negligence with regards to objectionable content by pointing out the size of the site.
Google CEO Sundar Pichai gave an interview to Axios at the time the new hate speech policies rolled out and said, “YouTube has the scale of the entire Internet.”
“YouTube apparently has a team of 10,000 people reviewing videos for objectionable content, and I have no doubt the team could be even bigger and everyone would still have a full docket,” Pichai added.