As the deadline ended for public comment on the Federal Trade Commission’s proposed update to the Children’s Online Privacy Protection Act Rule, various groups weighed in on more possible changes.

In September 2011, the FTC released proposed changes to the Rule that included clarification of the applicability of COPPA to online services, the broadening of definitions such as “personal information” and “collection,” updated requirements for parental notice, and new requirements for data retention and deletion.

After receiving more than 350 comments, the agency issued additional modifications to the Rule and requested another round of public comment.

A coalition of consumer groups, including the Center for Digital Democracy, Consumers Union, and Public Citizen, argued in a joint submission that the FTC’s proposals should go further. While the groups “generally support the Commission’s revised proposals,” the agency still has room for improvement, they said.

The definition of “personal information” should be expanded to include persistent identifiers, the groups wrote. “When marketers use information collected about an individual to display an advertisement chosen to appeal to that person at that time, they are contacting a specific individual online, even if they do not know the person’s full name.”

The coalition also suggested that parental permission should be required prior to the collection of data, regardless of whether ad networks have reason to know they are present on children-directed sites. “If third-party information collectors could be relieved from COPPA liability by claiming they did not know how their plugins were being utilized or where advertisements were placed, they would have an incentive not to know or find out this information.”

In response to comments on whether a Web site or online service designed “for both children and a broader audience” could be COPPA compliant without treating all of its users as children, the groups took a stance against the proposed change. The idea – supported by the Walt Disney Company for the creation of a “family-friendly” classification – would result in less protection for children, the groups said.

In its comments, Disney proposed the new classification as “a rational path for the development of family-friendly, privacy-protective Internet content and services, which would in turn encourage greater investment in family-friendly services such as premium content incorporated into a family-oriented service.” But the coalition said the proposal “would permit child-directed websites or services to avoid COPPA by ‘age gating,’ and children’s privacy would receive much less protections as a result.”

In other comments, the Interactive Advertising Bureau opposed a proposed change that would add “unique identifiers” to the definition of personal information. The adoption of identifiers would require prior parental consent before serving targeted ads to children. The change “would restrict children’s access to online resources by undermining the prevailing business model,” the IAB wrote.

The group also objected to the FTC’s idea that publishers would be liable for COPPA violations committed by app developers or ad networks. In addition to posing technical challenges, the “statute does not provide the authority to impose vicarious liability on first parties based on third-party practices,” wrote Michael Zaneis, senior vice president of the IAB.

Alternatively, the IAB said self-regulation of the industry “remains the best and most efficient means to address concerns about the collection of children’s online browsing data, without running the risk of dramatically reducing online resources available to children. Moreover, the proposed changes to the existing COPPA rule would undermine the active efforts of industry to promote and implement effective self-regulation.”

Facebook also objected to the changes and cited First Amendment concerns if the agency’s third-party liability proposal was adopted. Because those under the age of 13 face restrictions on the social networking site, including an inability to “like,” comment on, or recommend Web sites, Facebook argued that teens are being unconstitutionally restricted. “The Supreme Court has recognized on numerous occasions that teens are entitled to First Amendment protection. A government regulation that restricts teens’ ability to engage in protected speech – as the proposed COPPA Rule would do – raises issues under the First Amendment.”

To read the comments filed by the coalition, click here.

To read the IAB’s comments on the proposed Rule changes, click here.

To read Facebook’s comments, click here.

Why it matters: Now that the public comment period has expired, advertisers and marketers should keep a close eye for the finalized updates to the COPPA Rule that, according to The New York Times, should be issued “within weeks.”