Adults and children are counted among the 23-year-old fans of the “SpongeBob SquarePants” show, which helps explain why a mobile game based on the intellectual property was recently called into question by the Children’s Advertising Review Unit (CARU), a self-regulatory agency administered by the Council of Better Business Bureaus. The example illustrates how much of a gray area surrounds in-app advertising, particularly for mixed-age audiences, and could have broader implications as games expand.
CARU determined that the “SpongeBob: Krusty Cook-Off” app has a “mixed audience” of children and adults, but the game did not include the required protections (age verification and/or parental approval) to ensure that data does not are not collected or used for children under the age of 13. This put the game’s data collection practices in violation of the Children’s Online Privacy Protection Act (COPPA), and developer Tilting Point Media has taken corrective action.
“It’s not entirely new, but we’re seeing cases like this more and more,” said Amy Mudge, partner and co-leader of the advertising, marketing and digital media practice at the BakerHostetler law firm. “The law is complicated and not easy to interpret. And it will get more interesting and complicated as games move into the metaverse.”
A license to develop
When creating a licensed product that features a beloved character, developers should consider whether that product’s appeal might include adults and, at this point, their children. Tilting Point Media, creator of the mobile game “SpongeBob: Krusty Cook-Off,” found this out the hard way.
“Tilting Point violated the COPPA and CARU Privacy Guidelines by failing to provide an age-neutral and effective display to limit users under the age of 13 to content that does not involve the collection, use, or disclosure of personal information, or to obtain verifiable parental information. consent prior to the collection, use, or disclosure of any children’s personal information,” read one release issued by CARU in early September. Additionally, the self-regulatory agency found that many of the ads supporting the game were not clearly enough identified as paid support for young children.
Tilting Point Media “fully cooperated with CARU’s self-regulatory program [and] proactively implemented changes to address each of CARU’s concerns regarding its advertising and privacy practices,” according to the statement. For vendors and developers, the case points to what could be a growing concern as gaming audience increasingly includes families.
Planning an ad-based app that meets COPPA standards involves a decision tree that’s a bit like “a pinball machine,” Mudge said. Certain questions must be answered: What type of application is it? What does the app look like? How does the game work? How interactive is the environment? Each reply can send the thread in several different directions.
“You’re going to have to think hard about these things if the app is going to be interesting to kids,” Mudge said.
And developers have to assess how adjusting for children will affect the experience for adults. Going too far in meeting some of the requirements, such as clearly identifying in-game advertising and stopping data collection, can affect the overall user experience.
“Some may take the path of least resistance, but the choices you might need to make [to make it available] for children it may not be interesting for adults,” Mudge said.
Regulation vs innovation
Developers are getting better at creating forked experiences that can meet guidelines for younger children, still appeal to adults, and be enjoyable for everyone. Still, the rules aren’t as straightforward as the developers might want as they try to walk the line between responsible and attractive.
“What is still developing is the question of how open you need to be to identify an ad.” Mudge said. “It’s easy to say, but not so easy to execute. What do children understand when they are advertised online?
These concerns will only get more complicated, and deeper, as the metaverse unfolds. While everyone wants to be responsible with their advertising practices, they also want experiences to be as realistic and immersive as possible.
“We don’t want ad targeting to interfere with innovation,” Mudge said.
Some of these quirks may become clearer next month, when the Federal Trade Commission holds a virtual event, “Protecting children from stealth advertising in digital media”. The event will bring together researchers, child development and legal experts, consumer advocates and industry professionals in an effort to better understand the fundamental questions of age and developmental age and developmental age-identifying advertising content, what measures should be taken to prevent children from viewing blurry content, and the need for efficiency and disclosure as a solution.
While it’s a step in the right direction, Mudge points out that this is just the beginning of the conversation, and finding answers will likely take some time. In the meantime, marketers and developers will need to pay close attention to their shows’ potential audience if they want to stay on the good side of regulators.
“If they don’t know how to do this for adults, they certainly haven’t figured it out for kids yet,” he said. “We have to make sure that the guidance we are creating follows developments in the world of advertising.