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Today, the Federal Trade Commission announced that Google has agreed to pay a $170 million fine to settle some serious allegations against YouTube. The FTC alleges that YouTube illegally collected personal information from children without their parents’ consent, a violation of the Children’s Online Privacy Protection Act (COPPA).

The COPPA rule, enacted in 1998, states that “child-directed websites and online services must provide notice of their information practices and obtain parental consent prior to collecting personal information from children under 13.” Youtube allegedly used persistent identifiers to track users on child-directed channels, which likely earned the company millions of dollars in ad revenue.

Google paying the fine will avoid an FTC investigation into the issue.

Simultaneous with the announcement of this penalty, YouTube announced that it will make some sweeping policy changes related to child-focused content on the platform. The company chose Twitter as its platform for the announcement.

The four announced policy changes are listed below:

  • YouTube will treat data from anyone watching children’s content as coming from a child, regardless of the actual age of the user.
  • Personalized ads will stop running on content made for kids.
  • Features like comments and notifications will no longer be available on videos made for kids.
  • Creators will have to identify content made for kids and machine learning will help find the content that creators don’t properly disclose.

There’s little doubt that these policy changes will hurt YouTube’s revenue, at least somewhat. Combine that with the $170 million fine and you have a pretty significant hit to the company’s bottom line.

However, YouTube needs to make sure that parents feel comfortable with having their kids use the platform. After all, kids who watch YouTube early on in their lives will continue to watch YouTube as they grow, making them the future pillars of the service.

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