Children’s Online Privacy Rules: Winners and Losers

Now that the Federal Trade Commission has published its updated privacy protections for children online, Facebook may finally open its site to children under 13, industry analysts say. But those very same new rules, they say, may prompt some small app developers to pull out of the children’s market altogether.

The revised rules, widen the list of children’s personal information that will require parental permission to collect. It will now include children’s photos, videos or voice recordings, the IP addresses of their computers and the locations of their mobile phones. The updated rule also requires social networks, advertising networks and other third parties to get parents’ permission before knowingly collecting data from children’s sites and apps. But the rules have radically different implications for big Web sites and small app developers. The final children’s online privacy rule uses an “actual knowledge” standard for collecting information about children. That means social networks and ad networks that collect information from children without knowing that their software is operating on a children’s site or app will not be liable.