Microsoftis being hit with a large fine of $20 million after the Federal Trade Commission charged the company for illegally collecting children’s personal info on Xbox systems. The tech conglomerate has had a number of problems with the FTC recently, includingturbulence in Microsoft’s attempt to acquire Activision Blizzard.
Data collection has been a major focus in the eyes of both the public and the federal government in recent years. Many large tech companies have fallen under scrutiny, from TikTok bans being implemented or considered throughout much of the US over concerns of data handling within China to Mark Zuckerberg admitting fault in Facebook’s mishandling of user data. It seems as though a shockingly vast number of websites and apps are willing to go to extralegal measures to dip into the clearly lucrative economy of buying and selling data. NowMicrosoft, one of the oldest and largest companies in the tech space, is being hit with a big fine for gathering the data of kids playing on Xbox.
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The confirmation comes from a recent press release on the Federal Trade Commission’s official website. The FTC writes that Microsoft has violated COPPA (the Children’s Online Privacy Protection Act) by collecting data from accounts owned and operated by kids without getting permission from the parents or guardians first. The FTC said it hopes that this fine will result in the bolstering of children’s protections on the Xbox. Microsoft has fought the FTC in the past, even accusing the entity ofviolating the US Constitution over its lawsuit preventing the Activision Blizzard buyout. Xbox has issued a statement about the fine stating regret for the negligible safety in children’s data protection along with an assurance of more responsible practices in the future.
COPPA has been in place since 1998, meaning all of Microsoft’s consoles and online services have existed under these regulations This makes it extremely questionable how this could have happened at a company that has certainly been aware of this Act since the original Xbox’s launch back in 2001. The FTC claims that from 2015 to 2019, Microsoft wouldn’t force a parent to be involved in the creation of an Xbox account until after the child had already filled out all the required information, including a screen with a pre-checked box that allowed the info to be shared with advertisers. The Federal Trade Commission has also previously investigatedMicrosoft’s biggest video game competitor Sony for its buyout of Bungie.
Microsoft’s revenue in 2022 came close to reaching $200 billion, making it a massive question mark whether or not a $20 million fine is actually something that will make an impact or if it’s more or less the mega-corporate equivalent of a slap on the wrist. For reference, the Activision Blizzard buyout that Microsoft is attempting right now will be for $68.7 billion. $20 million is about .029% of that astronomically high buyout.
