TikTok’s parent company, ByteDance, has agreed to pay $92 million to end more than twenty lawsuits against the company. Several parties accused the Chinese social network of collecting data from underaged American users without permission. In addition to paying the settlement amount, the platform also promises to make several changes to its app with regard to data collection and data sharing.
TikTok Collects Data on A Large Scale
Last year, more than twenty lawsuits were filed against TikTok. Several parties accused the platform of collecting personal data from users on a large scale and selling data to advertisers. Others claimed that the social media platform passed on this personal information directly to the Chinese government. In total, the social network processed data from approximately 89 million US users.
According to the prosecutors’ attorneys, some of the users were only six years old. In the US, children under the age of 13 require parental consent to share personal information. That is why the Children’s Online Privacy Protection Act (COPPA) was brought in. Nonetheless, and despite previous agreements, TikTok continued to collect and store children’s personal information.
Even TikTok’s version for Younger Users, which has less functionality and is more privacy-aware, still collects some data. For example, it collects personal identifiers and user activity data. Moreover, TikTok is more than aware that it is very easy for children to lie about their age. Consequently, even very young children can create a +13 account.
$92 Million Settlement
Although TikTok denies all accusations, TikTok’s parent company, ByteDance, decided to reach a settlement. “Rather than go through lengthy litigation, we’d like to focus our efforts on building a safe and joyful experience for the TikTok community”, a spokesperson said in a statement to the press.
The $92 million settlement will bring an end to more than 20 lawsuits brought against the company for privacy violations. According to experts, this amount is on the higher end of similar deals. Last year, Facebook, agreed to pay $650 million in relation to a lawsuit over the illegal collection and storage of biometric data of millions of users.
In addition to handing over a large bag of money, ByteDance has agreed to make several changes to the app. They promised to no longer collect biometric data, or use geolocation or GPS data. They will also end the practice of pre-uploading US user-generated content and transmitting user data outside the US. The tentative settlement, which was published on the internet last Friday, now awaits final approval by US District Judge John Lee of the Northern District of Illinois.
Tiktok Previously Fined for Privacy Violations
It is not the first time that parties discredited TikTok for violating the privacy of its mostly underaged users. At the beginning of last year, the Federal Trade Commission (FTC) fined the company $ 5.7 million for illegally collecting data from minors. The Chinese social network also had to delete videos of children under the age of 13.
In response to the fine, TikTok promised to improve its practices. However, many privacy advocates, including the Center for Digital Democracy, said that TikTok had been flouting the settlement agreement. Consequently, in May 2020 they urged the FTC to investigate and sanction TikTok for putting kids at risk.
Concurrently, the US government tried to impose a download ban on TikTok and other Chinese applications. In September 2020, TikTok won a last-minute reprieve when a US federal judge ruled that a download ban was too premature and would shut down “a public forum used by millions of Americans”. The question remains if president Joseph Biden will take the order for ByteDance to divest TikTok’s US operations off the table.
Hit with Regulatory Complaints in Europe
Even with things settling in the US, TikTok is still facing a large number of legal challenges. In the EU, consumer protection groups from 17 EU member states have filed a series of coordinated complaints accusing TikTok of multiple breaches of EU law.
“Children love TikTok but the company fails to keep them protected,” said Monique Goyens, Director General of the European Consumer Organization (BEUC). “We do not want our youngest ones to be exposed to pervasive hidden advertising and unknowingly turned into billboards when they are just trying to have fun.”
The consumer organization also states that TikTok’s terms and conditions are incomprehensible to teenagers. The company does not communicate clearly enough what data it collects and what it does with this data. Finally, the interest groups find it unacceptable that TikTok can use videos from content creators without permission or financial compensation.