Microsoft breaching child privacy cost the company a $20 million fine.
The Federal Trade Commission (FTC) reached a settlement with Microsoft, ordering the company to pay a significant $20 million fine for illegally collecting data on children who created Xbox accounts. The violations included Microsoft’s failure to inform parents about its data collection policies, as required by the Children’s Online Privacy Protection Act. The company also retained the personal information of children under 13 for longer than necessary.
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Under the law, online platforms targeting children must obtain parental consent and disclose information about data collection practices. In this case, parents were not properly informed by Microsoft about the extent of the collected data, which included profile pictures, and how the company shared it with third parties.
Microsoft will implement enhanced safety measures for child gamers as part of the settlement. These measures include Microsoft establishing a system to delete all personal data after two weeks if the company does not obtain parental consent.
The settlement agreement still awaits approval from a federal judge before becoming effective.
Amazon paid $25 million to settle a similar case for retaining sensitive data on youngsters using Echo devices. Regulators stress child privacy rules to protect the privacy and data of young internet users.
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