Xbox COPPA violations cost Microsoft $20 million in FTC settlement

Microsoft will face new restrictions on what it can do with this young player’s info. (credit: Aurich Lawson / Thinkstock)

Microsoft will pay $20 million to settle an FTC complaint that its Xbox platform illegally collected and retained information about children without their parents’ consent, in violation of the Children’s Online Privacy Protection Act (COPPA).

According to the FTC complaint in the matter, Microsoft’s Xbox account sign-up process asked children under 13 for their name, date of birth, email address, and phone number, all before parents got involved in the sign-up process.

The complaint also alleges that Microsoft did not specifically notify parents that information such as uploaded photos and gameplay data associated with their player ID would be collected and potentially shared with third parties. Instead Microsoft included these specifics in a Privacy Statement, which the FTC says was akin to “sending parents off on what amounted to a DIY errand.”