Microsoft will pay the FTC $20 million to settle charges over collecting children's data
users' information and retaining their data even without their parents' consent. To be able to play Xbox games and use services like Xbox Live, users have to sign up for an account and provide their personal information, including their full name, email address and place of birth.
Until 2021, users were also asked for their phone number and to agree to Microsoft's advertising policy. The FTC found that Microsoft only asked users under 13 to get their parents to complete their account creation after they had already provided their personal information. And apparently, from 2015 until 2020, Microsoft collected and retained data from underage users, even if their parents didn't complete the registration process.
The FTC also explained that Microsoft combines a user's gamertag with a unique persistent identifier that it could share with third-party developers, even for accounts owned by underage users. In a, Dave McCarthy, the CVP Xbox Player Services, said Microsoft didn't intentionally keep child accounts that weren't completed by their parents.
In addition to paying $20 million to settle the FTC's charges, Microsoft will also be required under the DOJ's proposed order to change its account creation process for underage users. The tech giant has already updated the process so that it asks somebody's date of birth first and, if needed, ask for parental consent before it requires users to key in any other identifiable information.
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