The Walt Disney Company has agreed to pay a $10 million civil penalty to settle allegations that it violated the Children’s Online Privacy Protection Act (COPPA) by collecting data from children on its YouTube channel without obtaining parental consent and by improperly targeting advertising to them.
The settlement stems from a complaint filed in September 2025 that accused Disney of misclassifying a large portion of its YouTube videos as “Not Made for Kids” (NMFK) despite featuring child‑targeted content. YouTube’s “Made for Kids” designation system, introduced in 2019, requires creators to label videos directed at children so that personalized ads and data collection are disabled. Disney continued to rely on its default policy after YouTube notified the company in mid‑2020 that over 300 videos needed reclassification.
The Federal Trade Commission investigated the matter and the Justice Department announced the settlement. The fine is modest relative to Disney’s scale—its fiscal‑year 2024 revenue was $91.361 billion and net income $4.972 billion—yet it signals a tightening of COPPA enforcement across major digital media providers.
Disney’s management acknowledged the settlement and emphasized its commitment to compliance. Assistant Attorney General Brett A. Shumate said the Department would “root out any unlawful infringement on parents’ rights to protect their children’s privacy.” Disney’s spokesperson noted that the company is implementing a robust Audience Designation Program to ensure each video is individually assessed and properly labeled on YouTube, aiming to prevent future violations.
The settlement does not carry a market‑reaction component, as no significant analyst or investor response was reported. However, the action underscores the growing regulatory focus on child privacy online and may prompt Disney to review its data‑collection practices across all platforms, including Disney+, Hulu, and ESPN+, to avoid similar penalties in the future.
The $10 million penalty, while small compared to Disney’s overall financial performance, highlights the importance of COPPA compliance for large media conglomerates and serves as a warning to other companies that rely on user‑generated content for advertising revenue.
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