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MICROSOFT TO PAY $20M FOR CHILD PRIVACY VIOLATIONS

Published
6 June

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Image source, Getty Images
By Max Matza
BBC News, Seattle


Microsoft will pay $20m (£16m) to US federal regulators after it was found to
have illegally collected data on children who had started Xbox accounts.

The Federal Trade Commission (FTC) reached a settlement with the company on
Monday, which also includes increased protections for child gamers.

Among other violations, the FTC found that Microsoft failed to inform parents
about its data collection policies.

It follows a similar action against Amazon last week over its Echo devices.

The FTC said Microsoft violated the Children's Online Privacy Protection Act by
not properly getting parental consent and by retaining personal data on children
under 13 for longer than necessary for accounts created before 2021.

The law requires online services and websites directed towards children to
obtain a parent's consent and to inform the parent about personal data being
collected about their child.



Xbox users must create an account to use certain services. Information such as
full name, email address and date of birth are collected as part of the set up.

Not until after obtaining personal information, such as the child's phone
number, did Microsoft ask for a parent to provide permission.

From 2015 to 2020 Microsoft retained data "sometimes for years" from the account
set up, even when a parent failed to complete the process, the FTC said in a
statement.

The company also failed to inform parents about all the data it was collecting,
including the user's profile picture and that data was being distributed to
third parties.

"Regrettably, we did not meet customer expectations and are committed to
complying with the order to continue improving upon our safety measures,"
Microsoft's Dave McCarthy, CVP of Xbox Player Services, wrote in an Xbox blog
post.

"We believe that we can and should do more, and we'll remain steadfast in our
commitment to safety, privacy, and security for our community."



As part of the settlement, Microsoft must also institute new safety protections
for children. That includes maintaining a system to delete all personal data
after two weeks if no parental consent is obtained.

The order must be approved by a federal judge before it can go into effect.

Last week, Amazon agreed to pay $25m after the FTC found that it had retained
sensitive data, including voice recordings of children, for years.

Amazon's doorbell camera unit Ring also agreed to pay out $5.8m after giving
employees unrestricted access to customers' data.


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