XBOX's Data Collection On Kids Puts Microsoft Out A Cool $20M

There should be a better enforced age limit on this thing.

Back in the day, the way that gaming companies made their money was easy to understand. You'd pop a few quarters or tokens in before you were allowed to play Pac-Man. As we left the dark ages of gaming, you'd drop a lump sum on a console and buy the game separately. But companies like return customers, even better if the customer returns with money to buy basically the same thing.

There are a couple ways to continue making a post-purchase buck -- any EA sports gamer knows how lucrative the downloadable content (DLC) to further flesh out the game you previously bought can be. Another way? You pull a Google and sell the data you glean from your customers. That information collection is a nuisance, but hey -- we're all adults and know what's going on, right? Well, no. And after being taken to task for their lackluster security measures, Microsoft is out $20M. From Law360:

On Monday, the federal government filed a complaint in federal court alleging that Microsoft broke the law by collecting personal information from children who signed up to its Xbox gaming system without notifying their parents or obtaining their parents' consent, and by illegally retaining children's personal information.

The government alleged that from 2015 until at least October 2020, Microsoft indefinitely retained personal information from about 10 million individuals, including children, when users created Xbox Live accounts.

Microsoft allegedly retained personal information from children longer than necessary, "putting children's data at risk for uses outside parents' reasonable expectations and for compromise by unauthorized third parties," according to the complaint.

Who collects data on kids and why is a big issue. A large part of TikTok being under fire is the concern that the data it collects from Americans may be used by a hostile country. And the users of TikTok skew young. The Fed taking Microsoft to task for violating COPPA (Children's Online Privacy Protection Act) and the TikTok fiasco both fall under the umbrella of parents and lawmakers, despite not knowing exactly what their children are up to online, doing their best to protect their interests. I'd assume that it would be best for Microsoft to comply and do better moving forward. They should consider themselves lucky that they didn't get hit closer to Epic Game's $520m fines.

Microsoft To Pay Feds $20M Over Xbox Child Data Collection [Law360]

Chris Williams became a social media manager and assistant editor for Above the Law in June 2021. Prior to joining the staff, he moonlighted as a minor Memelord(TM) in the Facebook group Law School Memes for Edgy T14s. He endured Missouri long enough to graduate from Washington University in St. Louis School of Law. He is a former boatbuilder who cannot swim, a published author on critical race theory, philosophy, and humor, and has a love for cycling that occasionally annoys his peers. You can reach him by email at cwilliams@abovethelaw.com and by tweet at @WritesForRent.