Walt Disney has agreed to pay a $10 million fine after being accused by the U.S. government of violating children’s online privacy laws. On Tuesday, the Department of Justice announced that Disney had settled the case involving how it managed videos on YouTube. Officials stated that the company broke federal rules by collecting data from young viewers, leading to the hefty penalty and a new commitment to better protect children’s privacy going forward.
Mislabeled Videos and Data Collection
The issue began when Disney allegedly failed to correctly label many of its YouTube videos as ‘Made for Kids.’ According to the Children’s Online Privacy Protection Act (COPPA), any video intended for children under 13 must be properly identified. Disney reportedly neglected to do this for over 300 videos, including clips from popular films like Frozen, Toy Story, and The Incredibles.
As a result, the platform was able to collect personal data from children without their parents’ consent. By not labelling the videos appropriately, Disney and its partners were able to gather data about what children were watching and where they were located. This information was then used to serve “targeted ads”, advertisements customised to users based on their online activity. The government deemed this a serious violation, as the law is designed to give parents control over their children’s personal
The Federal Trade Commission (FTC), which first investigated the matter, said Disney even ignored prior warnings. Back in 2020, YouTube reportedly alerted Disney that hundreds of its videos were intended for children, yet the company didn’t adjust its labelling practices. Consequently, data from millions of young viewers was collected over several years without proper authorisation.
New Plan for Child Safety
As part of the $10 million settlement, Disney must now create a detailed compliance program to ensure such violations do not happen again. The company is required to review each video it uploads to YouTube to determine if it targets children, instead of labelling entire channels at once. This change ensures each video is evaluated individually to meet COPPA requirements.
The court order also prohibits Disney from violating children’s privacy laws in the future. If the company fails to comply, it could face steeper fines and additional legal action. The Department of Justice emphasised that this case should serve as a warning to major tech and media companies about the importance of protecting children’s privacy online.
Although Disney is a global entertainment powerhouse, the $10 million penalty ranks among the largest fines ever issued for a COPPA violation. Regulators hope the fine will prompt Disney and similar companies to take stronger measures to safeguard children’s personal data. The ultimate goal is to ensure that when children watch cartoons or movie clips online, their privacy is not compromised for advertising purposes.
What Parents Need to Know
This case underscores why laws like COPPA are crucial for families in today’s digital world. These rules require websites and apps to clearly explain what data they collect and to obtain parental consent before doing so. Assistant Attorney General Brett Shumate reaffirmed the government’s dedication to ensuring that parents maintain control over their children’s online activities.
For parents, this serves as a reminder to regularly review the privacy settings on the apps and platforms their children use. While large companies like Disney are now under greater scrutiny, experts still encourage parents to monitor what their children are watching online. YouTube’s “Made for Kids” feature can help, but it only works if video creators use it correctly.
With the settlement finalized, Disney is expected to begin implementing its new video review program immediately. Although the company has not yet released an official statement, it is reportedly cooperating with officials to close the case. The broader focus remains on ensuring that children can explore and enjoy the internet safely, without being tracked or targeted by advertisers.
Stay ahead with the recent business news. Follow Inspirepreneur Magazine for more.
