Google will pay $170 million to settle allegations that its video service YouTube collected personal data on children without ir parents’ consent. company agreed to work with video creators to label material aimed at kids and said it will limit data collection when users view such videos, regardless of ir . Some lawmakers and children’s vocacy groups, however, complained that settlement terms aren’t strong eugh to rein in a company whose parent, Alphabet, me a profit of $30.7 billion last year on revenue of $136.8 billion, mostly from targeted s. Google will pay $136 million to Federal Tre Commission and $34 million to New York state, which h a similar investigation.

fine is largest FTC has levied against Google, but it’s tiny compared with $5 billion fine against Facebook this year for privacy violations. YouTube “baited kids with nursery rhymes, cartoons, and more to feed its massively profitable behavioural vertising business,” Democratic Commissioner Rohit Chopra said in a tweet. “It was lucrative, and it was illegal.” federal government has increased scrutiny of big tech companies in past two years — especially questioning how tech giants collect and use personal information from ir billions of customers. Many of huge Silicon Valley companies are also under antitrust investigations aimed at determining wher companies have unlawfully stifled competition.

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Kids under 13 are protected by a 1998 federal law that requires parental consent before companies can collect and share ir personal information. Tech companies typically skirt that by banning kids under 13 entirely, though such bans are rarely enforced. In YouTube’s lengthy terms of service, those who are under 13 are simply asked, “please do t use Service.” Yet many popular YouTube channels feature cartoons or sing-a-longs me for children. According to FTC, YouTube assigned ratings to its video channels and even h a “Y″ category directed at kids s 7 or under, but YouTube targeted s to those kids just as y would ults. FTC’s complaint includes as evidence Google presentations describing YouTube to toy companies Mattel and Hasbro as “new Saturday Morning Cartoons” and ”#1 website regularly visited by kids.”

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“YouTube touted its popularity with children to prospective corporate clients,” FTC Chairman Joe Simons said. But when it came to complying with law, he said, “ company refused to ackwledge that portions of its platform were clearly directed to kids.”

According to settlement, Google and YouTube will get “verifiable” consent from parents before y collect or use personal information from children. company also agreed t to use data collected from children before. YouTube has its own service for children, YouTube Kids. kids-focused service alrey requires parental consent and uses simple math problems to ensure that kids aren’t signing in on ir own.

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YouTube Kids does t target s based on viewer interests way main YouTube service does. But children’s version does track information about what kids are watching in order to recommend videos. It also collects personally identifying device information. On Wednesday, Google said that starting early next year, YouTube will also limit personalised s on its main service for videos meant for kids. Google is relying on video creators to label such items, but will employ artificial intelligence to help.

'YouTube will still be big way to build an audience'

YouTube won’t seek parental consent re, however, even on videos intended for children. YouTube is avoiding that precaution by inste turning off any personal tracking on those videos, saying it will collect only what is needed to make service work. For such videos, YouTube also won’t offer features like comments and tifications. Videos me for kids will still feature s — just t targeted, personal s that generally bring in most money for video creators.

“I think re has been a general anxiety of kids and family community of creators on YouTube for quite some time,” said Chris Williams, CEO and founder of pocket.watch, a studio that works with many popular YouTube child stars, including Ryan ToysReview.

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Pocket.watch helps YouTube stars expand beyond streaming site and find new lines of business, from consumer products to network TV shows. Williams expects that business to become more important. But YouTube will still be big way to build an audience, he said. “It represents a part of puzzle for your brand growth, a big one,” he said.

settlement w needs to be approved by a federal court in Washington. As with Facebook settlement, FTC vote was 3-2, with both Democrats opposing it as too weak. Sen. Edward Markey, a Massachusetts Democrat, said settlement won’t turn YouTube into a safe place for children and “makes clear that this FTC stands for ‘Forgetting Teens and Children.’” A coalition of vocacy groups that helped trigger investigation said outcome will reduce behavioural vertising targeting children. Jeff Chester, executive director of Center for Digital Democracy, said settlement “finally forced Google to confront its longstanding lie that it wasn’t targeting children on YouTube.” But he said “paltry” fine signals that politically powerful corporations can break law without serious consequences.

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Or critics, including dissenting Democratic Commissioner Rebecca Slaughter, said too much responsibility was being placed on video creators to classify ir own content as kid-oriented, and thus limited to less-lucrative s. y say that potentially allows Google to turn a blind eye as some try to cheat system to make more money through revenue sharing. Andrew Smith, FTC’s consumer protection director, ackwledged that concern as valid, but said YouTube “has strong incentives to police its platform” to avoid furr action. Google is alrey under a 2011 agreement with FTC that barred it from mispresenting its privacy policy and subjected company to 20 years of regular, independent privacy audits. Google was fined $22.5 million in 2012 for violating that settlement when FTC found it improperly used tracking cookies on Apple’s Safari browser.