Alphabet Inc.’s Google doesn’t break out sales for the video site, but the company has reported that YouTube is its second-largest source of revenue behind search advertising. Research firm Loup Ventures estimates that 5% of YouTube’s annual revenue, or roughly $750 million a year, comes from content aimed at children.
YouTube had long maintained that children under 13 don’t use its site without parental supervision, as its terms of service stipulate, but according to the FTC, it touted young users in advertising materials. There’s ample evidence these young viewers flock to the site, and consumer groups complained last year.
The site has already made tweaks as it tries to create a safer destination for children. In recent months, it changed its algorithm to promote what it called “quality” kids’ videos, a shift that alarmed many of its video creators. Wojcicki said the newest transitions “won’t be easy for some creators” and the company would work with them and provide resources to navigate the changes.
The company also introduced more parental controls for YouTube Kids, the app it launched in 2015 to offer a smaller selection of YouTube’s massive library, and created a web version of the app. The service is far smaller than YouTube’s primary audience of more than two billion monthly visitors, and data show the main site is used by more children than the kids app.
Democratic Senator Ed Markey of Massachusetts, who was a key force behind the passage of COPPA, wrote in a June 25 letter that besides deleting kids’ data, the FTC should make YouTube start a campaign to warn parents about minors’ use of the platform, create ways to identify users under 13 and prohibit it from launching new kids’ services without the approval of independent experts.
Google isn’t the only big internet platform facing pressure for its practices with minors. Children’s advocacy organizations have filed complaints with the FTC accusing Facebook Inc. of tricking children into making purchases while playing games on the social network. The company recently disclosed it has discussed its children’s chat app with the FTC, although it’s not clear whether there was a formal probe. Kids advocates have also alleged that Amazon.com Inc.’s Echo kids smart speaker violates privacy law.
Google and other tech giants have faced fines over their practices involving children before. In 2014, Google agreed to refund at least $19 million to settle with the FTC for failing to get parental consent for charges racked up by children playing games on mobile devices. Apple Inc. also agreed in 2014 to refund at least $32.5 million and change its billing practices after similar complaints. Yelp Inc. previously said it paid $450,000 for allegations it failed to test the age-registration feature on its applications and collecting names and email addresses from children as young as 9 years old without the consent of their parents.
This article was provided by Bloomberg News.