‘No More Ads Means No More Income’: YouTube Hit With $170 Million FTC Fine
YouTube has been hit with the largest amount for a child protection case since the law’s introduction
Playtime is over for YouTube. The video sharing site has been hit with a $170 million fine by the US Federal Trade Commission (FTC) for violation of the Children’s Online Privacy Protection Act (COPPA). The settlement says that YouTube collected and tracked personal details of minors without first notifying parents and getting their consent.
The fine is the largest ever in COPPA’s 21-year history.
“When it came to complying with COPPA, the company refused to acknowledge that portions of its platform were clearly directed to kids,” said FTC chairman Joe Simons in a statement published this morning alongside the judgement.
“Regardless of your view on size, the COPPA fine is an important milestone,” says Dylan Collins, chief executive of SuperAwesome, a company focused on online child safety. “Whether big technology companies find it convenient or not, the internet has become a much, much younger place than it was when many of these platforms were started.” According to Collins, four in 10 new internet users are children.
We’ve known this has been coming for a long while — and have previously reported it — but what wasn’t known was the size of the monetary punishment, nor YouTube’s full response.
“No more ads means no more income.”
Part of the terms of the settlement compel the FTC to publish a “clear and conspicious” notice on its platform about COPPA, which is designed to prevent children being served adverts, or having data about them collected by tech firms.
But YouTube’s response is even more blunt than that. Within four months, anyone who watches kids content on YouTube will be assumed to be a child (even if they’re not). Content creators focusing on producing content for children will have to say they’re producing content for kids, and even if they don’t opt-in, YouTube say they’ll find the creators, deploying machine learning to find those videos and flag up the creators.
Those who produce content for kids will see much less data collected on their viewers (a hit for those looking to attract advertisers, who rely on the granular data) and will have both comments and notifications of new video uploads turned off — at a stroke decimating their way of connecting with an audience.
The owner of several channels starring and aimed at children believed that the change could affect some of their properties, but not others.
“We recognize this won’t be easy for some creators and are committed to working with them through this transition and providing resources to help them better understand these changes,” Susan Wojcicki, YouTube’s chief executive, said in an announcement posted in response to the FTC’s decision going public.
Those behind some of the world’s largest YouTube channels producing content for children agree. “No more ads means no more income,” says Bastian Manintveld, owner of 2btube, which helps run a number of child-focused YouTube channels across Europe.
Manintveld does see two potential saviors, though: the fact that YouTube says they’ll be stopping “personalized ads” means it might not be “all ads”. He’s also intrigued by YouTube’s separate announcement that they’d be offering $100 million in funding over the course of three years, “dedicated to the creation of thoughtful, original children’s content on YouTube and YouTube Kids globally”.
The media company executive said he needed to talk to his YouTube contact for more detail as to the future of his channels, as YouTube had not given him any formal warning ahead of its public announcement about the coming changes to child-focused channels.