Disney has reached a $10 million settlement with the U.S. Federal Trade Commission (FTC) after being found in violation of the Children’s Online Privacy Protection Act (COPPA). At the heart of the case is Disney’s failure to properly label child-directed content on YouTube as “Made for Kids” (MFK). Instead, many videos — including clips from Frozen, Moana, Cars, Tangled, Toy Story, and other beloved franchises — were incorrectly designated as “Not Made for Kids” (NMFK), enabling YouTube to collect personal data from viewers under 13 for targeted advertising without parental consent.
This mislabeling occurred despite earlier enforcement actions, such as the 2019 $170 million Google/YouTube COPPA settlement, and even after YouTube directly alerted Disney in 2020 about hundreds of mislabeled videos. Disney failed to change its corporate policy, which defaulted to channel-level audience designations instead of reviewing each video individually.
Under the settlement terms, Disney must not only pay the $10 million penalty but also implement a parental notification system and a robust program to ensure proper video designation going forward. This includes actively reviewing uploads to determine whether they fall under COPPA’s child-directed classification, moving beyond blanket defaults that left children vulnerable to data tracking.
The case highlights persistent challenges in COPPA compliance, where content creators, platforms, and major studios alike struggle to navigate the distinctions between “child-directed,” “family-friendly,” and general audience content. Missteps can lead to severe penalties, while proper classification often reduces monetization opportunities, creating tension between profit motives and child privacy rights.
The Disney settlement also reflects larger concerns about the datafication of children online, as minors increasingly engage with digital platforms that monetize personal information. With the 2025 COPPA Rule updates — including expanded definitions of personal information, mandatory opt-in parental consent for targeted advertising, and stricter retention policies — companies face growing regulatory pressure. Proposed laws like COPPA 2.0 and the Kids Online Safety Act (KOSA) may soon expand protections further, raising the age threshold to 16 and banning targeted ads to minors altogether.
For businesses, this enforcement action serves as a wake-up call: compliance must be proactive and operationalized, not treated as a checkbox exercise. For families, it underscores the importance of parental awareness, media literacy, and privacy education, ensuring children are better protected in a digital ecosystem increasingly built on surveillance and data monetization.
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