In legal settlements that could reshape the children’s app market, Disney, Viacom and 10 advertising technology firms have agreed to remove certain advertising software from children’s apps to address accusations that they violated the privacy of millions of youngsters.
The agreements resolve three related class-action cases involving some of the largest ad-tech companies — including Twitter’s MoPub — and some of the most popular children’s apps — including “Subway Surfers,” an animated game from Denmark that users worldwide have installed more than 1.5 billion times, according to Sensor Tower, an app research firm.
The lawsuits accused the companies of placing tracking software in popular children’s gaming apps without parents’ knowledge or consent, in violation of state privacy and fair business practice laws. Such trackers can be used to profile children across apps and devices, target them with ads and push them to make in-app purchases, according to legal filings in the case.
Now, under the settlements approved on Monday by a judge in the U.S. District Court for the Northern District of California, the companies have agreed to remove or disable tracking software that could be used to target children with ads. Developers will still be able to show contextual ads based on an app’s content.
“This is going to be the biggest change to the children’s app market that we’ve seen that gets at the business models,” said Josh Golin, the executive director of Campaign for a Commercial-Free Childhood, a nonprofit in Boston. “On thousands of apps, children will no longer be targeted with the most insidious and manipulative forms of marketing.”
The companies in the class-action cases did not admit any wrongdoing.
The settlements come as the Federal Trade Commission has been pursuing children’s privacy cases against individual developers and ad-tech firms. But children’s advocates said the class-action cases, which involved a much larger swath of the app and ad tech marketplace, could prompt industrywide changes for apps and ads aimed at young people.
Viacom, whose settlement covers one of its children’s apps, called “Llama Spit Spit,” Kiloo, a Danish company that codeveloped “Subway Surfers,” and Twitter declined to comment. Disney, whose settlement agreement covers its children’s apps in the United States, did not immediately response to emails seeking comment.