FTC puts regulation protecting kids online under review

Nearly a decade after it went into effect, the Federal Trade Commission is asking consumers and industry stakeholders whether its Children’s Online Privacy Protection Act Rule (COPPA) should be updated for the mobile age.

The agency is asking consumers and members of various Web-based industries whether mobile and interactive technologies, automated data collection systems and geolocation data, among other tools, have made the regulation outdated.

“There was a sense within the agency that technology has changed significantly, and that children’s use of technology has changed within the past five years since we did our last rule review,” said Phyllis Marcus, senior attorney at the FTC. “It wasn’t spurred necessarily by public request, but there are a number of advocates who have expressed concern that it might need to be expanded to take into account new marketing techniques.”

COPPA, which became effective in April 2000, regulates the operators of Web or online services aimed at children under 13, or those that knowingly collect personal information from children that age. The rule deems that online operators must notify parents and get their permission before collecting data from children. The regulation also requires that site operators, including marketers, keep that data secure.

As campaigns using Internet-based data collection technologies become more common, Marcus said COPPA is an “absolute rule” for marketers.

“It requires marketers to do specific things before they collect the personal information of children, and so a marketer who does not follow the long-standing law does so at his or her own peril,” she said.

In 2005, the FTC determined after a public comment period that no changes to the rule were needed.

Michael Becker, North American managing director of the Mobile Marketing Association, said that if the FTC deems changes to the rule are necessary, it will have to clearly define which mobile functions it is addressing.

“There is a lot to mobile, a lot of moving parts and a lot of factors. When COPPA was created, it was created for the Web, but when we look at mobile, there are multiple media, including SMS, mobile video, voice, mobile Internet, apps and Bluetooth,” he said. “There is also the issue of protecting the parent’s right to have control over what information is shared by their children and how that information is stored and managed.”

The 90-day comment period, which will include a public roundtable in Washington, DC, is scheduled to end June 30. However, the FTC has not determined a timeline for changes or implementation, according to Marcus, who said it could be a “lengthy process.”

The FTC has targeted marketers who improperly collect consumer information in the past. Last year, Sears Holdings settled with the FTC after the agency charged it with failing to adequately disclose the amount of consumer personal information it collected with a downloadable software application.

The federal agency is also asking the public to comment on the use of automated systems to review children’s Web submissions, or whether operators can contact individuals using information obtained from children online, including IP addresses or mobile geolocation data. The FTC will also explore whether there are new technological methods to obtain parental consent.

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