WASHINGTON (DPA) - YouTube has been ordered to pay US$170 million (S$235 million) to settle allegations that it illegally collected personal information from children without their parents' consent, the US Federal Trade Commission (FTC) announced on Wednesday (Sept 4).
The online video platform was accused of collecting personal data in the form of "persistent identifiers", also known as cookies, which are used to track users across the Internet.
YouTube collected the data from viewers of channels directed at children under 13 without first notifying parents and getting their consent, therefore allegedly violating a US regulation designed to protect children's online privacy, known as COPPA, the FTC said in a news release.
"YouTube touted its popularity with children to prospective corporate clients," FTC chairman Joe Simons said in a statement.
"Yet when it came to complying with COPPA, the company refused to acknowledge that portions of its platform were clearly directed to kids. There's no excuse for YouTube's violations of the law."
YouTube has earned millions of dollars by using cookies to deliver targeted ads to viewers of the channels, according to a complaint filed by the FTC and the state of New York.
The settlement requires Google, which owns YouTube, to pay US$136 million to the FTC and US$34 million to the state of New York.
"The US$170 million judgement is 30 times larger than the largest COPPA civil penalty the FTC has ever previously obtained," Simons said in a press conference on Wednesday.
"It is three times larger than any privacy penalty assessed against Google anywhere else in the world."
But two FTC commissioners dissented, saying the settlement was not harsh enough. Rohit Chopra said in a statement that the settlement offered no individual accountability and a fine amount that "still allows the company to profit from its lawbreaking," highlighting that analysts valued YouTube at US$180 billion last year.
YouTube said it will respond to the FTC's concerns by rolling out policies in around four months that change how it deals with data for children's content.
"We will treat data from anyone watching children's content on YouTube as coming from a child, regardless of the age of the user," the company said in a statement on its website.
"This means that we will limit data collection and use on videos made for kids only to what is needed to support the operation of the service."
YouTube also said it would stop running personalized ads and disable comments and notifications on children's content.