Sony collected, shared kids' info; FTC sues
In Robert Bly's “The Sibling Society,” the poet compares modern society to “Jack and the Beanstalk.” Jack is running from the giant and the giant's wife hides him in a cupboard. As parents giving our kids over to television and computer games and movies …
Context & Ripple Effects
This early FTC action against Sony over the collection and sharing of children's personal information was an opening move in what became a two-decade escalation of US enforcement under COPPA. The agency later moved to tighten online privacy protections for children in a 2012 rulemaking push, probed YouTube's handling of kids' videos in 2019, and by 2023 was preparing a COPPA complaint against Amazon's Alexa speakers for collecting data on under-13s without parental consent (the reported Alexa case). The through-line: regulators treating children's data as a distinct, higher-stakes category than general consumer data.
First-order effects
- Sony faces an active FTC lawsuit over its collection and sharing of children's information, putting its kids-facing products and data practices under direct regulatory scrutiny and forcing legal defense costs and potential consent-order obligations.
- Other companies marketing to children get immediate notice that the FTC will litigate rather than merely warn, raising the compliance bar for anyone handling under-13 data.
Second-order effects
- Competitors and adjacent platforms respond preemptively — tightening consent flows, age-gating, and data-sharing contracts with ad partners to avoid becoming the next target, as later seen when YouTube rethought its kids' strategy mid-probe and Amazon faced the Alexa complaint.
- Children's-focused advertising and analytics suppliers face demand risk as their clients' legal exposure makes third-party data sharing harder to justify commercially.
Third-order effects
- If the pattern holds, child privacy shifts from case-by-case enforcement to structural rulemaking — culminating in proposals like the FTC's 2023 push for opt-in targeted ads for under-13s and bans on certain data uses, plus sweeping reports documenting industry-wide 'vast surveillance' practices.
- The industry's business model for kids' digital services separates into two tiers: compliant, consent-first products versus ad-monetized ones that carry persistent regulatory risk, reshaping which companies can profitably serve young users at all.
The trend: Regulators are steadily converting children's online privacy from sporadic lawsuits into a durable, rule-based regime that constrains how any platform may collect, share, and monetize minors' data.