YouTube strategies sweeping modifications to kids videos after $170M fine

YouTube Wednesday revealed enormous modifications to how it deals with kids videos, as the United States Federal Trade Commission hit Google with brand-new guidelines and a record $170 million charge to settle a probe into the personal privacy of kids’s information on huge video website. It’s the biggest charge ever imposed for offenses of the Children’s Online Privacy Protection Act, or COPPA. 

YouTube’s CEO and some big developers — consisting of the dad of Ryan from the enormous kids YouTube channel Ryan ToysReview and Hank Green, a prominent YouBulb focusing on instructional videos — stressed that the most crucial thing is that YouTube enhances kids’s security. 

But critics, consisting of Democratic dissenting FTC commissioners, kept in mind that even a record-breaking charge wasn’t enough, provided Google’s scale. Based on Google’s efficiency in 2015, $170 million approximately corresponds to 2 days’ worth of earnings. Google produces the exact same quantity in income in about 11 hours. 

Andrew Smith, the director of the FTC’s Bureau of Consumer Protection, stated the significance of the FTC’s order exceeds the $170 million fine. The settlement is “a new front” in the FTC’s fight to safeguard kids’s information personal privacy, he stated, due to the fact that it pursued a platform instead of a material developer for the very first time. Wednesday’s offer settles claims that YouTube unlawfully gathered individual info from kids without moms and dads’ permission.

“We are holding a platform liable under COPPA for content posted by somebody else. That’s a really big deal,” Smith stated throughout an interview. 

Around completion of this year, YouTube will, in impact, begin dealing with all views of kids-directed videos on YouTube as if every watcher is a real kid, despite the audience’s genuine age. That suggests it’ll restrict the information it gathers on those views to the bare minimum — just what’s “needed to support the operation of the service,” YouTube stated. 

YouTube will likewise stop kids-oriented videos from having actually customized advertisements, remarks and notices. And it’ll need that uploaders inform YouTube when their videos are directed at kids. Most of the modifications are needed by the FTC settlement. One procedure — YouTube tapping maker discovering to assist authorities videos being categorized properly for kids — exceeds what the FTC needs. 

Channels that publish kids videos however do not determine them as such risk of getting struck with their own “aggressive” FTC fines, according to the commission. 

YouTube is the world’s greatest online video source, with 2 billion regular monthly users, and a substantial variety of the billions of videos seen on the website are targeted at kids. One research study recommends kids material might be the most-watched video classification on YouTube in general. But YouTube has actually come under fire for a series of scandals including kids. Wednesday’s $170 million charge resolved the information YouTube gathers, without a moms and dads’ permission. But YouTube has actually likewise dealt with scandals including videos of kid abuse and exploitation, horrible material in its YouTube Kids app and predatory remarks that sexualized clips of young kids. 

Parent impacts

Kid audiences and their moms and dads will not always see significant modifications to the YouTube experience from these modifications alone. Beyond the lack of remarks and notices, moms and dads will not require to stress as much about the information Google gathers whenever their kids spool up a video on YouTube. The modifications might suggest less advertisements on kids material due to the fact that the majority of YouTube’s advertisements are the individualized kind that will be prohibited from kids material. And the modifications might suggest that suggestions for kids videos are less advanced.

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But YouTube may be making additional changes beyond those announced Wednesday. The company said it would also be investing in its YouTube Kids app, including product improvements and a promotional campaign to raise awareness with parents. YouTube recently tightened its standards for which channels can be a part of YouTube Kids, cutting the number of channels on the app, and last week it widened YouTube Kids to the web, rather than offering it solely as a mobile app. 

YouTube will be creating a $100 million fund to be disbursed over three years to invest in “thoughtful, original children’s content” on YouTube and YouTube Kids.

“Responsibility is our number one priority at YouTube, and nothing is more important than protecting kids and their privacy,” YouTube CEO Susan Wojcicki said in a blog post Wednesday about the changes. 

Smith, the FTC official, said he hoped YouTube’s actions would eventually lead to YouTube, and other general-audience platforms, creating “kid-safe zones.” 

The group affected most deeply by the changes will be creators of children’s content, who stand to make less money and also face the risk of getting swept up into their own FTC penalties. And that may mean YouTube simply has fewer kids-video creators. Advertising is the main way many channels make money, and YouTube returns the majority of its advertising revenue back to creators. People who rely on YouTube for their business are significantly affected by anything that disrupts how much channels get paid for the ads that run with their videos. 

Ryan ToysReview, one highest viewed kids channels on YouTube, said that protecting kids on YouTube was more important than financial effects on creators. 

“The new policy may impact the YouTube Kids space ecosystem, but kids’ safety should be a priority,” Shion Kaji, the father of the channel’s star, Ryan, said in a statement Wednesday.

Ryan ToysReview has 21.4 million subscribers and a staggering 31.8 billion views — a full third more than PewDiePie, the world’s most-subscribed YouTuber. It is more insulated from YouTube’s planned policy changes than the average kids-video channel: Ryan ToysReview’s popularity on YouTube has unlocked lucrative other businesses beyond the ads running alongside its billions of views, including merchandising and partnerships with the likes of Amazon and Nickelodeon.

Next targets

The settlement with Google was the FTC’s first battle of this kind, but it won’t be the last, the commission said. Smith said more actions against large tech platforms, including possibly those that record voice commands, are more likely following the action against Google and YouTube. 

“If you think about all the platforms out there, and all the economic power that they wield and the amount of content that they host, this is game-changing,” Smith said. 

The FTC also warned that deceptive kids-content creators on YouTube could face their own aggressive fines. As part of the settlement, the FTC will make a sweep of YouTube’s videos after the company has implemented its required changes. Because YouTube will now require uploaders to identify videos directed at children, any channels that lie about the nature of their kids videos could be caught by the FTC in that sweep — and face “strong” civil-penalty fines, Smith said. 

Google’s track record

Google has had run-ins with the FTC in the past. In 2013, the agency wrapped up an investigation that decided unanimously that Google wasn’t violating any antitrust laws, after allegations of biased search results. 

But government officials have since taken a sharper stance toward tech companies. On Tuesday, The Washington Post reported that more than half of the country’s state attorneys general are targeting Google in an antitrust investigation that could be announced next week. 

Regulators and government officials are also scrutinizing the tech industry more broadly. The Justice Department in July announced an antitrust probe targeting Google, Apple, Facebook and Amazon. Meanwhile, House Democrats in June announced their own investigation into tech giants, meant to explore whether the companies are engaging in “anti-competitive conduct.” 

Google has also faced pressure from regulators in Europe. In March, the search giant was hit with a $1.7 billion fine from the European Commission for “abusive” online ad practices. The Commission said Google exploited its dominance by restricting its rivals from placing their search ads on third-party websites. Last year, the EU’s executive arm fined Google a record $5 billion for unfair business practices around Android, its mobile operating system. 

CNET’s Carrie Mihalcik contributed to this report. 

Originally published Sept. 4. 
Update, Sept. 5: Adds comment from Ryan ToysReview.