But it isn’t the $170M settlement figure that’s interesting

What’s It Going to Look Like?

Let’s start at the end, shall we?

What will YouTube look like after its recent settlement with the Federal Trade Commission (FTC)?

The agreement, which was shared with parent company Google and has made big, big news (see here, here and here), is seen to be yet another sign that federal and state regulators are taking off the gloves when it comes to the big tech companies.

But, in the immediate future, what does it mean for YouTube’s design?

The service, which was purchased by Google in the Dark Ages 2006, has always had a bit of an anarchic feel, which was preserved even after Google fitted it with its famed custom ad technology. To the present day, anyone can watch most of the platform’s videos without being challenged about who they are or whether the content they’re consuming is appropriate.

But that will have to change.

Demands

Here’s why. The FTC said about the agreement that “[t]he proposed settlement requires Google and YouTube to develop, implement, and maintain a system that permits channel owners to identify their child-directed content on the YouTube platform so that YouTube can ensure it is complying with COPPA.”

As you know (but in case you don’t), COPPA is the Children’s Online Privacy Protection Act, and it requires websites to obtain parental consent before gathering personal information – including browsing habits – from children under 13. That includes cookies, which are the lifeblood of Google’s ad model.

The Commission brushed aside arguments that YouTube’s 13-and-over registration requirement made any difference to whether a good deal of its content was actually viewed by children. (See this article for background.)

But there’s more: “The companies must notify channel owners that their child-directed content may be subject to the COPPA Rule’s obligations and provide annual training about complying with COPPA for employees who deal with YouTube channel owners.”

Channel owners, who are allowed to monetize their presence on the platform, will be drawn into the “system” as well.

The Takeaway

Oh – there’s also the $170 million penalty. You can tell that even the normally stuffy FTC staff is excited about something when they break out the charts.

But, in the end, the money isn’t the real story – as the New York Times article cited above notes, the entire penalty represents only 1.7% of parent company Alphabet’s profit last quarter. It’s nothing.

What is tantalizing is how on earth YouTube will be refitted so permission can be sought from parents before any personal information is collected about a child under the age of 13. This change will be a vast undertaking.

According to the FTC at least, both companies were aware of their influence on children and the size of their under-13 audience. The companies boasted “YouTube: The new Saturday morning cartoons” in one marketing presentation. “The #1 website regularly visited by kids” claimed another.

While sloganeering like this served as evidence for the Commission to demonstrate Google and YouTube’s unlawful behavior, it also serves to point out the immensity of the problem facing the companies.

Thirty million people visit YouTube every day.

Which of them are kids?