Aiming to prevent companies from exploiting online information about children under 13, the Obama administration on Dec. 19 imposed sweeping changes in regulations designed to protect a young generation with easy access to the web.
But some critics of the changes worry they could stifle innovation in the market for educational apps.
Two years in the making, the amended rules to the decade-old Children’s Online Privacy Protection Act go into effect in July. Internet privacy advocates said the changes were long overdue in an era of cell phones, tablets, social networking services, and online stores with cell-phone apps aimed at kids for as little as 99 cents.
Siphoning details of children’s personal lives—their physical location, contact information, names of friends, and more—from their internet activities can be highly valuable to advertisers, marketers, and data brokers.
The Obama administration has largely refrained from issuing regulations that might stifle growth in the technology industry, one of the U.S. economy’s brightest spots.
Yet the Federal Trade Commission pressed ahead with the new kids’ internet privacy guidelines, despite loud complaints—particularly from small businesses and developers of educational apps—that the revisions would be too costly to comply with and would cause responsible companies to abandon the children’s app marketplace.
As evidence of internet privacy risks, the FTC last week said it was investigating an unspecified number of software developers that might have gathered information illegally without the consent of parents.
(Next page: What the new rules say)