Disney Pays $10M in FTC Kids’ Data Privacy Settlement

Disney Pays $10M in FTC Kids’ Data Privacy Settlement

Introduction

The Federal Trade Commission (FTC) announced that Disney will pay $10 million to resolve allegations that the company facilitated the unlawful collection of children’s personal information. The settlement stems from violations of the Children’s Online Privacy Protection Act (COPPA), a federal law designed to safeguard the online privacy of children under 13.

Alleged COPPA Violations

According to the FTC, Disney Worldwide Services and Disney Entertainment Operations failed to properly label certain YouTube videos as “made for kids.” This mislabeling allowed children to access features on YouTube deemed inappropriate for their age group. The complaint also stated that Disney’s practices enabled the improper collection of children’s personal data without parental consent, in violation of COPPA regulations.

FTC Response and Penalties

FTC Chairman said the agreement penalizes Disney for breaching parents’ trust and ensures stronger oversight moving forward. Under the settlement, Disney must implement a video-review program that uses age-assurance technology to better identify and categorize child-directed content.

Background on COPPA

COPPA, enacted in 1998, requires websites and online services that target children to notify parents about data collection practices and to obtain parental consent before gathering any personal information. The FTC emphasized that Disney’s failure to comply undermined these legal protections.

Content at the Center of the Case

The disputed videos included clips from popular Disney films such as Frozen, Coco, and Toy Story, as well as music from The Incredibles. The FTC said the improper labeling exposed young viewers to features that should have been restricted to adult audiences.

Disney’s Response

A Disney spokesperson clarified that the settlement does not involve Disney-owned platforms but relates specifically to some of the company’s content distributed on YouTube. “Disney has a long tradition of complying with children’s privacy laws and remains committed to leading in this space,” the spokesperson said.

YouTube’s Role in Child-Directed Content

YouTube, owned by Alphabet, requires video uploaders to mark content as “made for kids” when children are the primary audience or when the content is clearly aimed at them. The platform warns that failure to comply may result in legal consequences under COPPA.

Settlement Terms

In addition to the $10 million payment, Disney must establish a monitoring program to review whether videos uploaded to YouTube should be classified as child-directed. This requirement mirrors a similar order YouTube faced in 2019 after its own COPPA settlement with the FTC.