COPPAcalypse? The YouTube Settlement’s Impact on Kids’ Content

We examine how privacy restrictions affect online content creation and consumption by evaluating the impact of YouTube’s settlement with the Federal Trade Commission over violating the Children’s Online Privacy Protection Act. Under the settlement, YouTube limited personalization for made-for-kids (MFK) content starting in January 2020, and this included personalized ads and content engagement features such as subscriber notifications and playlists. We study the resulting impact on 5,066 top American YouTube channels by comparing the MFK content creators to their non-MFK counterparts using a difference-in-differences design. On the supply side, MFK content creators produce 18% less content and pivot toward non-MFK content production. MFK content creators also invest less in content quality: the proportion of original content falls by 9% and manual captioning drops by 28%, whereas viewer content ratings fall by 9%. On the demand side, views of MFK channels fall by 20%. The restrictions also affected market competition, increasing concentration of both content creation and viewership among top MFK channels.

This paper was accepted by Jean-Pierre Dubé, marketing.

Funding: This work was supported by the Questrom School of Business Digital Business Institute, the Program on Economics & Privacy at George Mason University, and the “Economics of Digital Services” initiative by the University of Pennsylvania’s Center of Technology, Innovation & Competition and Warren Center.

Supplemental Material: The online appendix and data files are available at https://doi.org/10.1287/mnsc.2024.05295.