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FTC addresses children's privacy

Responding to mounting pressure from children's advocates, the Federal Trade Commission sets guidelines for the collection of personal data from young surfers.

Responding to mounting pressure from children's advocates, the Federal Trade Commission set guidelines today for the collection of personal data from young surfers.

After mulling over online privacy issues for a week in June, it became clear that the FTC would focus its regulatory power on children's issues. The FTC guidelines were handed out today via a letter the agency's Bureau of Consumer Protection wrote to a children's site it was investigating, KidsCom.

Web sites must now obtain parental permission before distributing private data about a child to a third party, the FTC stated. Prior to gathering information from minors, sites must also clearly disclose to parents how the data will be used. Violation of these guidelines could now be deemed a unfair and deceptive practice, which gives the FTC authority to investigate. However, the FTC staff letter didn't recommend enforcement at this time.

The Center for Media Education requested the FTC probe, claiming KidsCom--a site geared at children ages 4 to 15--was gathering minors' names, birth dates, product preferences, and hobbies. When CME filed the complaint, it said KidsCom was not accurately disclosing how the data would be used. The data was in fact released to other companies in an "anonymous and aggregate form."

Since the filing, KidsCom has voluntarily changes its practices. But the FTC's findings set a precedent for other business.

"Today's action makes it clear that many of the practices currently used by online marketers to elicit personal information from children can be prosecuted by the FTC," CME president Kathryn Montgomery said in a statement.

The FTC guidelines state the following: "It is a deceptive practice to represent that a Web site is collecting personally identifiable information from a child for a particular purpose when the information will be used for another purpose, which parents would find material in the absence of clear and prominent disclosure to that effect."

As a rule, the FTC said, sites that ask kids for details must disclose who is gathering the data; what is being collected; who will use the data; and give parents an option for blocking the disclosure of their child's information.

"Any pioneer in uncharted territory is apt to make a few missteps; that's the nature of exploring new frontiers," said Jorian Clarke, president of KidsCom Company, publishers of the KidsCom site. "But our track record shows that we learn and lead responsibly. It's a track record that's been recognized by parents, educators, industry experts, and now the commission."