Disney Will Pay $10 Million for Collecting Children’s Data from Its YouTube Videos

Disney has been caught up in a controversy that has led to a hefty fine of $10 million for allegedly collecting children’s data from its YouTube videos. The Federal Trade Commission (FTC) revealed that Disney had failed to comply with the Children’s Online Privacy Protection Act by not marking certain videos as “Made for Kids,” thereby allowing the collection of young viewers’ data for targeted advertising purposes.

In response to the allegations, Disney has agreed to pay a $10 million civil penalty to settle the claims made by the FTC. Additionally, the entertainment giant is required to implement and maintain an audience designation program to ensure that all its YouTube videos are correctly classified in alignment with the federal law.

According to the FTC’s complaint, in June 2020, YouTube alerted Disney about approximately 300 videos that had not been designated as “Made for Kids.” These videos featured beloved characters from Disney’s popular franchises like The Incredibles, Coco, Toy Story, Tangled, and Frozen. Despite YouTube’s notification and subsequent redesign of the videos, Disney allegedly continued to designate videos based on channel-level default settings rather than marking individual videos appropriately.

The complaint also highlighted that targeted advertising campaigns were enabled on videos labelled both as “Made for Kids” and “Not Made for Kids,” and uploaded to channels specifically aimed at children, including Disney Channel, Disney Junior, and Nat Geo Kids. This practice raised concerns about the misuse of children’s data for advertising purposes.

FTC chairman Andrew Ferguson emphasised the importance of penalising Disney for breaching parents’ trust and outlined the need for enhanced safeguards to protect children online. In response, Disney affirmed its commitment to the safety and well-being of children and families while also clarifying that the settlement pertains to the distribution of some content on YouTube’s platform, not Disney’s owned and operated digital platforms.

This incident involving Disney is not an isolated case, as in 2019, YouTube paid a substantial fine of $170 million for similar violations related to collecting children’s data. Following the settlement, YouTube enforced stricter guidelines requiring content providers to disclose whether their videos are intended for a young audience as part of their efforts to enhance online safety measures.

As companies navigate the digital landscape, ensuring compliance with laws safeguarding children’s online privacy remains crucial. The case of Disney serves as a reminder of the importance of transparency and accountability in handling user data, particularly when it pertains to vulnerable groups like children. Moving forward, stricter enforcement and oversight may be necessary to uphold the integrity of online platforms and protect the privacy of young users.