Sony BMG to Pay $1 Mln Over Child Privacy

Sony Music has agreed to pay $1 million to settle charges that it collected information about Website visitors under age 13 without parents' consent.

Sony BMG has agreed to pay $1 million to settle allegations the company has been in violation of the Children’s Online Privacy Protection Act (COPPA) by collecting information from children under the age of 13 on some of its Web sites without parents’ consent. The COPPA act is enforced by the Federal Trade Commission, which alleged in a suit that Sony BMG was collecting, maintaining and disclosing personal information about children on some 196 Web sites it operates for music fans in support of Sony BMG artists. Many of these sites enabled users to create personal fan pages, upload photos, post comments, and exchange private messages.

The FTC complaint alleged that Sony’s privacy policy indicated children under 13 would be restricted from using interactive Web page features, but that the company accepted registrations from children who entered birthdates indicating they were under 13 years old.

“Sites with social networking features, like any Web sites, need to get parental consent before collecting kids’ personal information,” said FTC Chairman William E. Kovacic, in a statement. “Sony Music is paying the penalty for falling down on its COPPA obligations.”

The settlement is the largest to date involving a COPPA case, and requires Sony BMG to pay a $1 million civil penalty, delete all personal information collected in violation of the rule, and completely abide by the rule moving forward. Sony BMG will also be required to link to specific FTC consumer education materials for the next five years.

Sony BMG is currently in the process of changing its name to Sony Music Entertainment after buying Bertelsmann AG’s 50 percent stake in the joint venture last August for about $900 million.