As part of the federal government's efforts to enforce the Children's Online Privacy Protection Act, it has tightened laws regulating information collection on the Internet.
The Federal Trade Commission, or FTC, has declared that companies can collect information online from children under 13, but only if their parents approve and the companies don't share the data--just one among several contentious provisions within a new law aimed at protecting the privacy of children on the Internet.
The FTC's ruling, which will be enforced beginning April 21, 2000, should have a dramatic impact on hundreds of child-oriented Internet sites that offer entertainment in exchange for personal information often resold to marketers. "There's a real problem out there" says FTC Chairman Robert Pitofsky. "We're going to give the industry six months to get its act together to make changes. After that, we'll monitor these Websites and we'll take enforcement action."
In two years, the FTC will reconsider whether e-mail can be more widely used to seek a parent's permission, as techniques improve for ensuring the identity of e-mail authors. "We think the commission has done a thorough job of taking the law and coming up with rules that Web operators can work with," says Kathryn Montgomery, president of the Washington-based public-interest group Center for Media Education, which helped raise the issue of children's online privacy in 1996.
The Children's Online Privacy Protection Act, passed in 1998, requires commercial Websites to get consent from parents before asking children under 13 for their names, addresses, telephone numbers or other identifying information. The FTC discovered that nearly 90 percent of more than 200 commercial sites for children collected personal information. Of those, only 24 percent posted privacy policies and just 1 percent required parental consent before children could submit personal information.
More Websites now play by the rules, according to Elizabeth Lascoutx, director of the Children's Advertising Review Unit of the Council of Better Business Bureaus in New York. "They have pared way back in part because the FTC was coming out with these rules and they wanted to avoid restrictive legislation by embracing self-regulation" says Lascoutx. "The industry recognized there was a real issue here."
Patti Brestel, vice president of BigChange Networks LLC, a new Washington-based Internet company that intends to teach teen-agers and preteens how to manage money, praised the new ruling. …