The Mouse House will pay the US Federal Trade Commission (FTC) US$10 million to settle allegations of COPPA violations concerning its YouTube content.

The complaint filed by the Department of Justice accused Disney of failing to mark some of its YouTube videos with the “Made for Kids” label—which allegedly resulted in targeted ads through the collection of kids’ personal data.

Since YouTube’s own US$170-million FTC settlement in 2019, the platform began requiring content creators add the “Made for Kids’ label to kid-targeted content to disable personalized ads (as well as other features like comments and autoplay of older-skewing video suggestions) in order to comply with rules established by the Children’s Online Privacy Protection Act. 

The FTC complaint alleged that Disney didn’t update designations on some of its videos, which defaulted to a “Not Made for Kids” label—and these uploads included visual content and music from kid-targeted IPs like The Incredibles, Coco, Toy Story, Frozen (pictured) and Mickey Mouse.

The US$10-million FTC settlement could pave the way for similar legal complaints against other kids companies that may not have carried out the correct labeling of children’s videos on YouTube.

“This case underscores the FTC’s commitment to enforcing COPPA, which was enacted by Congress to ensure that parents, not companies like Disney, make decisions about the collection and use of their children’s personal information online,” said FTC chairman Andrew Ferguson. “Our order penalizes Disney’s abuse of parents’ trust, and, through a mandated video-review program, makes room for the future of protecting kids online—age assurance technology.”

As part of the settlement, Disney has also agreed to comply with COPPA rules, such as notifying parents and obtaining their consent for collection and use of data from kids under 13.

The media giant must also set up a system to review whether its videos posted to YouTube need the “Made for Kids” label—at least until YouTube successfully implements “age assurance technologies” that can determine ages of YouTube users. The platform has been testing AI tools to verify users’ ages in the US. “This forward-looking provision reflects and anticipates the growing use of age-assurance technologies to protect kids online,” the FTC said in a release.