Google will pay USD 170 million to settle allegations its YouTube video service collected personal data on children without their parents' consent.
The company agreed to work with video creators to label material aimed at kids and said it will limit data collection when users view such videos, regardless of their age.
Some lawmakers and children's advocacy groups, however, complained that the settlement terms aren't strong enough to rein in a company whose parent, Alphabet, made a profit of USD 30.7 billion last year on revenue of USD 136.8 billion, mostly from targeted ads.
Google will pay USD 136 million to the Federal Trade Commission and USD 34 million to New York state, which had a similar investigation.
The fine is the largest the FTC has levied against Google, but it's tiny compared with the USD 5 billion fine against Facebook this year for privacy violations.
YouTube "baited kids with nursery rhymes, cartoons, and more to feed its massively profitable behavioral advertising business," Democratic Commissioner Rohit Chopra said in a tweet.
"It was lucrative, and it was illegal."
In YouTube's lengthy terms of service, those who are under 13 are simply asked, "please do not use the Service."
The FTC's complaint includes as evidence Google presentations describing YouTube to toy companies Mattel and Hasbro as the "new Saturday Morning Cartoons" and the "#1 website regularly visited by kids."
Sen. Edward Markey, a Massachusetts Democrat, said the settlement won't turn YouTube into a safe place for children and "makes clear that this FTC stands for 'Forgetting Teens and Children.'"
Jeff Chester, executive director of the Center for Digital Democracy, said the settlement "finally forced Google to confront its longstanding lie that it wasn't targeting children on YouTube."