FTC expands rules protecting online privacy of children to cover apps, games

The Federal Trade Commission (FTC) on Wednesday unveiled its update to a law aimed at protecting the privacy of children when they are online.

The Children's Online Privacy Protection Act (COPPA), passed in 1998, restricts the ability of websites to knowingly collect information from children younger than 13. The FTC is tasked with enforcing and updating the law.

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At a press conference on Capitol Hill on Wednesday, FTC Chairman Jon Leibowitz noted that Congress passed COPPA before the rise of smartphones, mobile apps and social networks.

"The Internet of 2012 is vastly different from the Internet of more than a decade ago," he said.

The FTC's new rules clarify that the restrictions cover not only websites, but also games, apps, ad networks and other online plug-ins.

The regulations also expand the definition of personal information to cover photos, videos and geolocation data.

The rules restrict the ability of websites to install tracking files, known as cookies, on children's computers. Advertisers use cookies to track users' browsing history and display targeted ads to them.

Sen. Jay Rockefeller (D-W.Va.), chairman of the Commerce, Science and Transportation Committee, said an update to COPPA was long overdue.

"The FTC is proposing common sense updates to the COPPA Rule that better reflect the realities of the current online world," he said.

Rockefeller added that he wished the FTC could have gone further, but he acknowledged that the agency is limited by the authority given to it by Congress.

"The FTC really went as far as they could," he said.

Jeff Chester, executive director of the Center for Digital Democracy, a privacy advocacy group, said the new rules are a "major step forward."

“We are especially gratified that this decision puts to rest the longstanding and disingenuous claims by the digital marketing industry that cookies and other persistent identifiers are not personally identifiable information," he said.

But some industry groups expressed concern that the new regulations will stifle Internet commerce.

The App Developers Alliance said it is "deeply concerned that the new regulations will be so expensive to implement and create so much risk that talented and responsible developers will abandon the children’s app marketplace."

Steve DelBianco, executive director of the business group NetChoice, said the changes "will deter innovation on websites not directed to children, and the changes will discourage creation of new educational tools for children.”

At the press conference, Leibowitz noted that the regulations do not affect advertisements unless they use cookies to track users.

"Business models that depend on advertising can continue to thrive," he said.

The Center for Democracy and Technology, a civil liberties group, applauded the FTC for restricting the ability of companies to collect data on children, but it expressed concern that by expanding the definition of a website "directed at children," the FTC could cause confusion for site owners.

The group predicted that the change will lead more sites to use age verification pages, which would give the sites liability protection under COPPA.

"Requiring age verification from every user runs counter to the First Amendment right to access information anonymously and increases the collection of potentially sensitive information generally," the group said.