STEVE INSKEEP, HOST:
Did the United States government punish YouTube strongly enough? The Federal Trade Commission fined the channel's owner, Google, for marketing to children without their parents' consent.
(SOUNDBITE OF YOUTUBE VIDEO)
UNIDENTIFIED PERSON: (Singing) If you're happy and you know it, clap your hands.
(SOUNDBITE OF HANDS CLAPPING)
UNIDENTIFIED PERSON: (Singing) If you're happy and you know it, clap your hands.
(SOUNDBITE OF HANDS CLAPPING)
INSKEEP: That's one of many, many, many videos that drew in kids for targeted ads, and that was the problem. Some members of the FTC felt that even the $170 million fine to Google was not enough. And one of them is Rohit Chopra, who is in our studios. Good morning, sir.
ROHIT CHOPRA: Good morning.
INSKEEP: What's wrong with $170 million?
CHOPRA: Well, that will do nothing to change Google's incentives when it comes to illegally collecting data on kids. Analysts value YouTube at $180 billion. And of course, it's owned by Google, own worth more than $800 billion.
INSKEEP: So you're arguing $170 million is like a $5 parking ticket for a company of this size?
CHOPRA: Well, according to my calculations, the penalty is actually less than what they earned from illegally spying on kids. So I worry that's not a penalty. That's an incentive.
INSKEEP: Let's make sure that we're clear. When you say illegally spying on kids, it is simply a matter of, there's a kid, she's going back and forth to different videos on YouTube. Google is gathering data on this child and tracking this child and then targeting ads to the child. That was the violation, right?
CHOPRA: That's right. Our children's privacy law doesn't allow companies to track kids across the Internet and collect individual data on them without their parents' consent. And that's exactly what YouTube did, and YouTube knew it was targeting children with some of these videos.
INSKEEP: Can Google have said, you know, gosh, the Internet is still relatively new. We didn't quite realize this was a violation of the law? Is there any ignorance defense here at all?
CHOPRA: Well, for a company like Google, which is one of the largest corporations on the planet, that doesn't really hold much muster. They allegedly took steps to comply with all sorts of laws. But here's where it comes down to. It was lucrative to do this. Collecting data on children and getting it to advertisers and monetizing it is worth a lot.
INSKEEP: What would have been a penalty that would be appropriate if $170 million is chump change?
CHOPRA: Well, I had similar objections with the FTC's Facebook settlement. You know, to me, the core problem is that their financial incentive is to massively collect data to feed their behavioral advertising model.
INSKEEP: Meaning the business model is still the same and still profitable.
CHOPRA: That's right. And no individuals were held accountable. There's no meaningful fixes to the core problems of this business.
INSKEEP: Let me just ask about that, though, because this settlement also includes - so the fine also includes some privacy protection measures. Those aren't enough?
CHOPRA: Well, here's what it will do. YouTube now has to ask content creators whether their content is directed to children or not. And I worry that that will lead YouTube and Google to pin the blame on content creators, even if YouTube really does know that it's for kids.
INSKEEP: Much as Facebook has said, we're just a pass-through, is what they will say. Mr. Chopra, thanks so much.
CHOPRA: Thank you.
INSKEEP: Rohit Chopra is a member of the Federal Trade Commission. And we should note that both Google and YouTube are among NPR's sponsors. Transcript provided by NPR, Copyright NPR.
