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Illustration: Rebecca Zisser/Axios

Google will pay $170 million to settle a Federal Trade Commission complaint that its YouTube subsidiary illegally collected children's personal information, the agency announced Wednesday morning.

The big picture: The FTC touted the settlement, details of which had circulated widely last week, as a record-breaking penalty that would shape YouTube's future behavior. But critics — including the FTC's two Democratic commissioners — argued that both the size of the fine and accompanying new restrictions on the company's behavior don't go far enough to protect the public.

Details: The FTC found that YouTube's tracking of underage users violated provisions of the 1998 Children's Online Privacy Protection Act (COPPA) because the company failed to notify users of child-directed channels about the tracking and obtain parental consent.

  • Under a consent decree that is part of the settlement, YouTube will be required to build a system for "channel owners to identify their child-directed content" so YouTube can comply with COPPA rules.

What they're saying: "This settlement achieves a significant victory for the millions of parents whose children watch child-directed content on YouTube," FTC chairman Joseph Simons and commissioner Christine Wilson wrote in a release. "It also sends a strong message to children’s content providers and to platforms about their obligation to comply with the COPPA Rule. "

"We believe the significant monetary penalty, coupled with the far-reaching conduct relief, is almost certainly better than what we would achieve in litigation. Importantly, the relief for consumers is immediate, rather than after years of litigation."
— Simons and Wilson

The $170 million penalty "is almost 30 times higher than the largest civil penalty previously imposed under COPPA," Wilson notes.

Yes, but: That's still small compared with the tens of billions Google earns in revenue annually, and critics of the settlement argue that it won't serve as as real deterrent to the company and its peers.

  • Similar criticisms arose in July when the FTC announced its much larger $5 billion settlement with Facebook for privacy violations.
  • In a dissenting statement, commissioner Rohit Chopra argues: "The Commission repeats many of the same mistakes from the flawed Facebook settlement: no individual accountability, insufficient remedies to address the company’s financial incentives, and a fine that still allows the company to profit from its lawbreaking. The terms of the settlement were not even significant enough to make Google issue a warning to its investors."

What's next: The settlement, which also would conclude a parallel inquiry by New York state, must be approved by a Federal district court judge.

Go deeper: For tech giants, profits far outweigh fines

Go deeper

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Moderna's COVID-19 vaccine is effective against new variants of the virus that first appeared in the U.K. and in South Africa, the company announced on Monday.

Yes, but: The vaccine was as effective against the strain from U.K., but saw a six-fold reduction in antibodies against the South Africa variant. Even still, the neutralizing antibodies generated by the vaccine "remain above levels that are expected to be protective," according to the company.

Dave Lawler, author of World
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Chinese President Xi Jinping warned that a "new cold war" could turn hot, and must be avoided, in a speech on Monday at World Economic Forum’s virtual “Davos Agenda” conference.

Why it matters: Xi didn't refer directly to U.S.-China tensions, but the subtext was clear. These were his first remarks to an international audience since the inauguration of President Biden, whose administration has already concurred with Donald Trump's determination that China is committing "genocide" against Uyghur Muslims, and issued a warning about China's aggression toward Taiwan.

Updated 2 hours ago - Politics & Policy

Dominion files $1.3 billion defamation lawsuit against Rudy Giuliani

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Dominion Voting Systems filed a defamation lawsuit against Rudy Giuliani on Monday seeking $1.3 billion in damages for his "demonstrably false” allegations about the company's voting machines.

Why it matters: Giuliani led former President Trump's efforts to overturn the results of the election and spread the baseless conspiracy theory that Dominion's voting machines flipped votes from Trump to Joe Biden.