Thursday 4 October 2012, 12:10 | By

Warner fan services company in million dollar settlement over privacy rule breaches

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Artist Arena

A Warner Music subsidiary that runs official online fan clubs for various top pop artists has reportedly agreed to pay a $1 million ‘civil penalty’ over charges filed by the US Federal Trade Commission that it breached rules in America’s Children’s Online Privacy Protection Act regards taking personal information from web-users under the age of thirteen without their parents’ consent.

The charges relate to online fan clubs that were run by Artist Arena for Rihanna, Demi Lovato, Justin Bieber and Selena Gomez. The FTC says that the sites knowingly took personal data off those twelve or under without securing the ‘verifiable parental consent’ required under COPPA.

According to the Wall Street Journal, the Warner fan services company has not formally admitted or denied the failings, but FTC member Edith Ramirez told a children’s marketing conference in New York this week that the firm had agreed to settle with the Commission by paying a $1 million penalty, deleting all data obtained in breach of COPPA rules, and displaying a link to a government website offering guidance on privacy on all its sites.

According to reports, that settlement deal is still to be approved by a judge, though the Bieber Fever website, the only one of the four sites accused of breaking COPPA rules to still be operated by Artist Arena, is already carrying a link to the government information site in pretty large type. The registration process for that site has also changed, and it’s thought under thirteens are no longer allowed to join.

Warner bought a stake in Artist Arena in 2007 before taking complete ownership in 2010, part of the music major’s bid to expand, like its rivals, out of the traditional recordings and song publishing strands of the music business, and into other increasingly lucrative parts of the industry. Neither Artist Arena nor Warner have so far commented on the FTC deal.

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