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Controversial attempt to protect kids online is signed into law by California governor

By Jon Swartz

Gov. Gavin Newsom OKs age-appropriate design code, first-of-its-kind law in the U.S. that even critics acknowledge 'would radically reshape the Internet' if adopted widely

A California bill that could establish a national baseline for protecting children's personal information and activity online was signed into law by state Gov. Gavin Newsom on Thursday.

The California Age-Appropriate Design Code Act, modeled after U.K.'s Age Appropriate Design Code, requires digital platforms such as Meta Platforms Inc.'s (META) Facebook and Instagram, Snap Inc.'s (SNAP) Snapchat and TikTok to vet whether new products pose harm to kids and teens before rolling them out. The first law of its kind in the U.S. would also force those companies to offer privacy guardrails to younger users by default.

The sweeping children's online safety measure, passed by the California Legislature Tuesday, rested on the pen of Newsom, a Democrat who hadn't indicated whether he would sign or veto the bill. Its passage is likely to intensify pressure on Congress to give priority to expanding protections for children. If passed, the bill would become law on July 1, 2024.

In-depth: U.S. laws protecting kids online languish behind Europe

"We have an opportunity in California to lead the way in making the digital world safer for all American children, giving them the highest level of protection possible in the online world," state Assemblymember Buffy Wicks, D-Oakland, the bill's primary author, said in a statement to MarketWatch.

Advocates of the kids online bill insist it will have as profound an impact on consumers as California Consumer Privacy Act (CCPA), a privacy-rights law for consumers, and its amended sequel, the California Privacy Rights Act (CPRA).

"This is a landmark step toward protecting California kids online. We want it to have the same impact as CCPA," Common Sense Media CEO Jim Steyer, whose advocacy group backed both measures.

"It changes the ground rules for technology companies yet again, adding a new layer of privacy legislation for companies whose online products or services are likely to be accessed by minors under the age of 18," data-privacy attorney Christine Lyon, told MarketWatch. "This law will reach many companies that are not subject to our federal data privacy law, [the Children's Online Privacy Protection Act of 1998], which applies only to children under the age of 13."

But critics argue the bill would require mandatory age authentication and change how everyone uses the Internet, according to Eric Goldman, who has written extensively on the topic and serves as co-director of the High Tech Law Institute at Santa Clara University Law School.

For more: Regulating Big Tech will be hard, and California is proving it

"The bill would radically reshape the Internet, requiring businesses to authenticate all of their users' ages -- and that is bad news for everyone,"Goldman told MarketWatch. "Users will first be required to prove their age before they can visit any new site -- even if they just plan to visit for a second, and even if they never plan to return. More importantly, the authentication process is highly invasive."

Goldman disputed the comparison to the CCPA, which he dismissed as a toothless law. "Though [CCPA] has been in effect for a few years, can anyone show me a material benefit to consumers, the public or anyone else?" he asked.

Trade groups representing the likes of Meta and Twitter Inc. (TWTR) have lobbied against the bill, claiming it would blunt innovation, violate constitutional protections for free speech, and would be overly burdensome and invasive for users.

"It's another example of why we need a federal privacy law that includes universal standards to protect kids online instead of a patchwork of state laws that creates confusion and compliance complications for businesses," says Dylan Hoffman, California executive director for TechNet, whose members include Alphabet Inc.'s (GOOGL)(GOOGL) Google, Inc. (AMZN), Apple Inc. (AAPL), eBay Inc. (EBAY), Meta and Snap.

See also: Biden finalized his plan to rein in Big Tech. Big Tech wasn't invited

Meta has taken steps to lower the heat. In August, it announced updates to the blog post it published earlier this summer that makes it harder for young people to come across potentially harmful or sensitive content or accounts in Search, Explore, Hashtag Pages, Reels, Feed Recommendations and Suggested Accounts.

Additionally, Meta says teens younger than 16 (or 18 in certain countries) are defaulted into private accounts and other private settings.Across Instagram, Facebook and Messenger, the company says it only allows advertisers to target ads to people under 18.

Snap had no comment. Twitter did not respond to email seeking comment.

-Jon Swartz


(END) Dow Jones Newswires

09-16-22 0811ET

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