Alexei Oreskovic | Vox

FTC Urged to Investigate YouTube Kids Video App

2019-03-06T05:20:42-05:00

A coalition of consumer and children advocacy groups plans to urge federal regulators to investigate a YouTube video app aimed at children that the groups say disregards long-established safeguards limiting advertising to young audiences.

The YouTube Kids app, which was released in February, blends video programming and ads in ways that deceive children and parents, according to the groups, which include the Center for Digital Democracy, the American Academy of Child and Adolescent Psychiatry and the Consumers Union.

The groups will send a letter to the U.S. Federal Trade Commission on Tuesday asking it to examine whether the app violates rules prohibiting unfair and deceptive marketing practices.

“The videos provided to children on YouTube Kids intermix commercial and other content in ways that are deceptive and unfair to children and would not be permitted to be shown on broadcast or cable television,” reads the letter.

Google-owned YouTube, the world’s most popular video website, launched the app earlier this year to provide families with a version of its service that it said was safer and easier for kids to use.

The selection of videos featured in the app is limited to content that is appropriate for younger audiences, and the app features parental control settings that can restrict viewing time and Web search capabilities.

The critics’ letter said that YouTube’s Kids app, which it said is listed on the Apple iTunes store for children age 5 and under, features several “branded channels” for companies such as fast-food company McDonald’s and toymaker Mattel’s Fisher-Price brand.

Those channels mix programming, such as a cartoon about a children’s character, with ads for toys based on the same character, a practice the groups said is not permitted on television.

While YouTube promised not to include food and beverage commercials in the app, the letter cites examples such as 30-second television ads for McDonald’s Happy Meals that is included among the videos on the fast-food company’s channel.

The letter also said that YouTube does not make clear when the “user-generated videos” featured on the app, such as videos of children excitedly unwrapping new toys, are in fact paid endorsements in which the creators of the video were compensated by toy companies or media companies.

“We worked with numerous partners and child advocacy groups when developing YouTube Kids. While we are always open to feedback on ways to improve the app, we were not contacted directly by the signers of this letter and strongly disagree with their contentions,” a YouTube spokeswoman told Reuters.

Representatives at Mattel and McDonald’s did not immediately respond to emails seeking comment.

(Additional reporting by Supriya Kurane in Bengaluru; Editing by Steve Orlofsky and Anupaam Dwivedi)

This article originally appeared on Recode.net.

Facebook Acquires Mobile Data Plan Firm Pryte

2019-03-06T05:54:37-05:00

Facebook is acquiring Pryte, a Finnish company that aims to make it easier for mobile phone users in underdeveloped parts of the world to use wireless Internet apps.

Facebook did not disclose financial terms of the deal, which spokeswoman Vanessa Chan said is expected to close later this month.

Pryte’s service, which has not publicly launched yet, seeks to make it easier for consumers without wireless data plans to use online services by selling short-term passes that would provide access to particular mobile apps, such as Facebook or Foursquare.

Facebook, the world’s largest social network with 1.28 billion users, is primarily interested in the team behind Pryte, led by Chief Executive Markku Makelainen, Chan said.

The one-year-old, Helsinki-based company has valuable experience and relationships working with wireless operators, particularly in emerging markets, she said.

The company has fewer than 30 employees, though it’s not clear how many will join Facebook.

The deal marks Facebook’s latest effort to advance its mission of connecting people in underdeveloped parts of the world to the Internet. Facebook has partnered with wireless operators in certain countries to offer free access to its social network and the company is building drones and satellites that will beam Internet access to remote regions of the world.

Facebook Chief Executive Mark Zuckerberg has said that connecting the “next five billion people” to the Internet is one of the company’s top priorities going forward.

(Reporting by Alexei Oreskovic; Editing by Bernard Orr)

This article originally appeared on Recode.net.

Facebook to Expand Video Ads to Seven Countries Outside U.S.

2019-03-06T05:53:47-05:00

Facebook Inc is expanding its new video advertising service, allowing marketers to show the television-like spots to users of the social network in Britain, Brazil and five other countries, the company told Reuters.

The move marks a significant ramping up of one of Facebook’s most closely watched new advertising products, which analysts believe could help the Internet company capture a bigger slice of lucrative brand advertising budgets.

The 15-second video ads appear in users’ newsfeeds and play automatically with the sound muted until they are clicked on. Facebook began selling the ads in the United States in March to a small group of marketers including insurance company Progressive Corp and television broadcaster NBC, a unit of Comcast Corp.

Facebook said the performance of the initial group of video ads in the United States has been strong, but declined to elaborate.

As it did in the United States, Facebook is moving cautiously to roll out the auto-play video ads in its overseas markets to avoid annoying users. The company will initially work with a limited group of advertisers in France, Germany, Brazil, Japan, Canada, Australia and Britain starting next month.

Each ad must pass a quality-control test that Facebook administers in conjunction with video analytics firm Ace Metrix.

Most of the commercials in international markets will not appear on Facebook’s website until September, as the Internet company spends several months working closely with marketers to ensure that the spots meet its quality standards, a Facebook spokesman told Reuters.

But he said that companies whose commercials are deemed acceptable could begin airing them on Facebook in June, in time for the World Cup international soccer tournament, a popular event for brand advertisers.

Video ads, along with ads on the Facebook-owned Instagram photo-sharing app, are among the new businesses that analysts believe could turn into important money-makers for Facebook, though the company has said it does not expect video ads to contribute meaningfully to its business this year.

Facebook’s ad revenue grew 82 percent year-on-year to $2.27 billion in the first quarter.

The price that marketers pay to run a video ad on Facebook is determined by the size of the audience as measured by measurement firm Nielsen. Marketers can choose specific times of day for their spots and can target ads according to age and gender.

Online video ads, which typically carry much higher rates than other forms of online ads, could help Facebook bolster its ad revenue in international markets where the company’s average revenue per user is lower than in the United States and Canada.

Roughly 84 percent of Facebook’s 1.28 billion monthly users are outside of the United States and Canada, with 87 million monthly users in Brazil and 34 million monthly users in the UK at the end of the first quarter, according to the company. Daily mobile users in Brazil increased 75 percent to 35 million in the nine-month period ending in the first quarter, Facebook said.

(Editing by Matthew Lewis)

This article originally appeared on Recode.net.