Report: YouTube Planning To Drop Targeted Ads In Kids' Videos

Under pressure from government regulators and consumer advocates, YouTube is “finalizing plans” to cease taking behaviorally targeted ads on videos oriented to children, according to Bloomberg.

Bloomberg’s report, which cites “people familiar with the matter” as sources, cautions that YouTube could still change its plans.

The Federal Trade Commission is investigating whether YouTube violated the Children’s Online Privacy Act. COPPA requires websites to obtain parental consent before knowingly collecting many type of information (including geolocation data, mobile telephone numbers, and persistent identifiers) on children under 13. That effectively bars delivering data-driven, behavioral ads to children under that age.

However, it’s not known whether the FTC probe is the driver behind YouTube's expected targeted ad ban.

In July, it was reported that the FTC had voted to approve a settlement that included fining Google-owned YouTube millions of dollars, but the terms had not been released, and it still needed approval from the Justice Department.

“Getting rid of targeted ads on children’s content could hit Google’s bottom line -- but this solution would be far less expensive than other potential remedies that aim to placate regulators” – such as forcing YouTube to move all children’s videos (if such could somehow be defined) to YouTube Kids. That remedy was proposed last year by a consortium of consumer groups.

Another solution, informally proposed by FTC Chairman Joseph Simons to those groups, would have YouTube disable all ads, including those placed via content context rather than behavioral targeting — another concept unlikely to be welcomed by YouTube.

Researcher Loup Ventures estimates that YouTube’s revenue from children’s media at between $500 million and $750 million per year, reports Bloomberg. “Paring back targeted ads [which command higher prices] would dent that revenue, although Google has the ability to make its contextual ads more compelling to mitigate the damage, said Doug Clinton, a Loup Ventures analyst. He pegged the potential impact of YouTube curbing targeted ads at 10% of its overall intake from kids’ videos — so about $50 million.”

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