Introduction The Children's Online Privacy Protection Act, passed by Congress last October, authorizes the Federal Trade Commission to develop rules for regulating data collection on commercial Web sites targeted at children. In addition to the collection and use of personal contact information, the rule also regulates the disclosure of personal information by the child through the use of any of the collaborative tools of the Internet. Verifiable consent from parents is required under the Rule whether the site operator actually collects and uses personal contact information of children or provides any of the collaborative tools of the Internet to children who may then misuse the feature and disclose personal contact information. The Rule, as proposed today, makes it very difficult for a small, child focused web business to survive. This makes sense economically since a business can weigh the value of each child customer against the cost of complying with the data collection rules.
Traffic is the basis of the economic value in most Internet companies today.
This proposed rule imposes the same high data collection costs upon businesses who in fact do not collect or use the personal contact information of children as those companies who do have a model that supports such costs. It is our position that a child's use of collaborative tools on the Internet should be treated very differently than the collection and use of personal contact information from children by marketers. We believe these fun and educational tools can be made very safe for a child's use on a child's site through adult monitoring, filtering technology, enforcement of safety policies, and instructing children on Internet safety. Making access to these tools designed and built for kids difficult, is exactly the wrong thing to do to promote safety. This analysis envisions several possible methods of data collection.