Markets have only just opened in the US, and already Wednesday is shaping up to be a difficult day for Alphabet, the parent company of Google and YouTube.
First, the FT published a report based on leaks from the Irish data regulator, which has jurisdiction over Google's European operations since the company's European headquarters is based in Dublin. Google has allegedly been using 'hidden' web pages to feed personal data gleaned from its users to paying advertisers, circumventing the EU's GDPR privacy regulations in the process.
Google rival Brave said it submitted evidence of this arrangement to the company's regulators. Google collects sensitive user data, like the race, health status and political leanings of its users, then secretly harvests this data for use in targeting ads, something that's illegal in Europe.
Johnny Ryan, Brave's chief policy officer, told the FT that he discovered the secret web pages as he tried to monitor how his data were being accessed and used on Google’s advertising exchange, which is the largest marketplace for ad sales space across the web.
Ryan said he discovered that Google had labelled him with an identifying tracker that it fed to third-party companies, which logged on to a hidden web page. The page showed no content, but it tracked Ryan’s browsing activity.
This appears to violate Google's own rules prohibiting ad buyers from matching different social media profiles for the same user, in addition to EU laws and regulations.
A spokesperson for Google said the company hadn't seen the details of Ryan's independent "investigation", but added that it was cooperating with any and all investigations carried out by European regulators.
In other news, YouTube agreed to pay $170 million to the FTC and the AG of New York State to settle allegations that it illegally collected data from children younger than 13 who watched children's content on the platform, according to the Washington Post.
Regulators alleged that certain YouTube knew certain channels were popular among younger viewers, and that it touted this fact to brands and advertisers. To gather more data, YouTube tracked kids’ viewing histories for the purpose of serving them targeted advertisements, ultimately raking in "millions of dollars" despite obviously violating children's privacy laws.
YouTube also agreed to change its business practices by ending the collection of data on YouTube of videos that are clearly created with younger audiences in mind. The settlement echoed concerns raised by nearly two dozen consumer privacy groups, who alleged that YouTube was side-stepping COPPA - or the Children's Online Privacy Protection Act - the only federal law explicitly governing what tech firms are allowed to do regarding user data collection.
Still, the settlement, which didn't require the company to admit guilt, stopped short of what advocates were hoping for.
YouTube CEO Susan Wojcicki said in a blog post Wednesday that the settlement would "better protect kids and families on YouTube," adding: "We'll continue working with lawmakers around the world in this area."