FTC proposes new rules to protect kids from online monetization

The Federal Trade Commission has proposed changes to the Children’s Online Privacy Protection Rule or COPPA Rule, that would place new restrictions on the use and disclosure of children’s personal information and further limit the ability of companies to condition access to services on monetizing children’s data. The proposal aims to shift the burden from parents to providers to ensure that digital services are safe and secure for children. In a notice of proposed rulemaking, the FTC is seeking comment on proposed changes to the COPPA Rule aimed at addressing the evolving ways personal information is being collected, used, and disclosed, including to monetize children’s data, and clarifying and streamlining the rule. The COPPA Rule, which first went into effect in 2000, requires certain websites and other online services that collect personal information from children under the age of 13 to provide notice to parents and obtain verifiable parental consent before collecting, using, or disclosing personal information from these children. The rule also limits the personal data that websites and other online services can collect from children, limits how long they can retain such data, and requires them to secure the data. “Kids must be able to play and learn online without being endlessly tracked by companies looking to hoard and monetize their personal data,” said FTC Chair Lina M. Khan. “The proposed changes to COPPA are much-needed, especially in an era where online tools are essential for navigating daily life-and where firms are deploying increasingly sophisticated digital tools to surveil children. By requiring firms to better safeguard kids’ data, our proposal places affirmative obligations on service providers and prohibits them from outsourcing their responsibilities to parents.”Companies that mat be impacted by this include: Meta Platforms (META), Snap (SNAP), X(TWTR), Alphabet (GOOG, GOOGL), Spotify (SPOT) and Tencent (TCEHY).