FTC To Change Privacy Rules to Curb Monetization of Children's Data

FTC To Change Privacy Rules to Curb Monetization of Children's Data

News by Nikola Djuric
Published: December 21, 2023

The U.S. Federal Trade Commission (FTC) has taken a decisive step on Wednesday toward enhancing the privacy and security of children's online experiences.

The FTC proposed major changes to the Children’s Online Privacy Protection Act of 1998 (COPPA), focused on setting stricter limitations on the use of children's personal information, thereby curbing the ability of companies to monetize such data.

The revisions to the COPPA encompass a range of new requirements.

One of the key aspects is the introduction of a mandatory opt-in for targeted advertising. This change stipulates that websites and online service operators must obtain verifiable parental consent before disclosing children's information to third parties, including advertisers.

The FTC's proposal also reinforces the current rule’s prohibition on conditioning a child's participation in online activities on the collection of more personal information than necessary.

Another significant aspect of the proposed changes is the restriction on the use of persistent identifiers, commonly used to track a child’s activity online, without first obtaining verifiable parental consent.

Lastly, the FTC aims to limit the operators from using online contact information and persistent identifiers to send push notifications to children, which are often used to encourage them to use their service more frequently.

Meanwhile, the FTC has proposed specific measures to prohibit the commercial use of children’s information in this sector. This would allow schools to authorize EdTech providers to collect, use, and disclose students’ personal information, but solely for educational purposes and not commercial gain.

The FTC received over 175,000 public comments in 2019 when it began the latest review of its regulations under COPPA. In the same year, it issued hundreds of millions of dollars in combined fines to YouTube and TikTok for mishandling data from users under 13.

The FTC's full press release is available on the link

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