YouTube COPPA Update how YouTube Creator income be impacted?

What is the Children’s Online Privacy Protection Rule?

Congress enacted the Children’s Online Privacy Protection Act (COPPA) in 1998.  COPPA required the Federal Trade Commission to issue and enforce regulations concerning children’s online privacy.  The Commission’s original COPPA Rule became effective on April 21, 2000.  The Commission issued an amended Rule on December 19, 2012.  The amended Rule took effect on July 1, 2013.

The primary goal of COPPA is to place parents in control over what information is collected from their young children online.  The Rule was designed to protect children under age 13 while accounting for the dynamic nature of the Internet.

However, in 2013, the FTC amended COPPA, broadening the scope to (1) expand the definition of “operators” to include creators who publish on ad-assisted platforms like YouTube, and to (2) expand the definition of “personal information” to include persistent identifiers (such as web cookies), which advertisers rely on to run ads matched to an appropriate audience (colloquially known as “targeted ads” or  “personalized ads”). For six years, this amendment was never enforced against YouTube creators; however, as part of the aforementioned settlement with YouTube, the FTC has stated that they intend to start enforcing the regulations on creators individually.
In practice, that means as of Jan. 1, 2020, all content creators will have to designate whether or not each of their videos is “directed to children” (aka “kid-directed” aka “child-directed”) by checking a box during the upload process. Checking that box will prevent the video from running personalized ads.

What is Personal Information? (Privacy Protection)

The amended Rule defines personal information to include:
  • First and last name;
  • A home or other physical address including street name and name of a city or town;
  • Online contact information;
  • A screen or user name that functions as online contact information;
  • A telephone number;
  • A social security number;
  • A persistent identifier that can be used to recognize a user over time and across different websites or online services;
  • A photograph, video, or audio file, where such file contains a child’s image or voice;
  • Geolocation information sufficient to identify street name and name of a city or town; or
  • Information concerning the child or the parents of that child that the operator collects online from the child and combines with an identifier described above.
What exactly does “kid-directed” mean?

The exact definition of “kid-directed” is entirely based on the discretion of the FTC, and is determined by evaluating the given video against 10 factors, including:
  • the subject matter of the site or service
  • the video’s visual content
  • the video’s of animated characters or child-oriented activities and incentives
  • music or other audio content in the video
  • age of models featured in the video
  • presence of child celebrities or celebrities who appeal to children in the video
  • language or other characteristics of the website or online service
  • and whether advertising promoting or appearing on the website or online service is directed at children.
The bottom line is if you make content that is intended for teens or adults, but also contains elements from the FTC’s list of 10 factors that appeal to kids under 13, you’re in danger of being demonetized starting the beginning of the new year.

How drastically will YouTube Creator income be impacted?

We asked creators to go into Creator Studio and disable personalized ads (called “Interest-Based Ads”, under the “Advanced” tab) for a few days. Based on our initial testing, a video not running  personalized ads sees a loss in revenue somewhere between 60% to 90%. So, if a video on a given channel could generate $100 in revenue for a creator right now with personalized ads running, categorizing the video as “directed to children” (and therefore removing the personalized ads) would mean the video’s revenue would drop to somewhere between $10 and $40.

Facing a loss that large might be enough to make some creators consider not checking the “directed to children” box even if they make videos for kids. But consequences for that are stiff. If the FTC decides an uploaded video is kid-directed, but sees it is not marked as kid-directed, the creator could face a fine of over $42,000 per video. That financial liability is enough to bankrupt most creators.

Why is the FTC bringing creators into this?

FTC believes that creators running personalized ads poses a privacy risk to kids, despite the fact that the creators themselves have no access to data about individual viewers. The FTC assumes that banning personalized ads on any content kids enjoy is in a child’s best interest; it doesn’t see the unintended consequences for creators who, in some cases, rely almost entirely on personalized ads to make their livelihoods.

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