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Amazon Settles Two Privacy Cases with FTC for Under $31 Million

Amazon settled two separate privacy cases with the Federal Trade Commission (FTC) for just under $31 million on Wednesday. The company agreed to pay penalties because it violated children’s privacy with its Alexa smart speakers and exposed Ring smart doorbell users’ videos to everyone at the company.

Ding Dong, It’s a Ring Employee Watching Your Videos

According to the FTC’s complaint, Ring employees and contractors had unrestricted access to watch, download, and share users’ videos, even if the videos had nothing to do with a particular employee’s job. The employees’ and contractors’ access was handled without any technical or procedural protections for the users’ videos until 2017.

The FTC’s order also highlights that Ring’s disregard for privacy and security exposed consumers to unwanted spying and harassment. It also clarifies that putting profits over privacy doesn’t pay.

Hey Alexa, Can You Stop Spying on My Children?

Amazon’s children’s privacy practices have been called into question in the second privacy lawsuit by the FTC focused on Alexa. The FTC alleges that Amazon misinformed parents about its children’s privacy practices, kept their data forever, used it for ulterior purposes, and exposed kids to potential data breaches.

Furthermore, when parents asked the company to delete the voice data, Amazon held onto transcripts of what kids were saying, which the FTC considers a violation of the Children’s Online Privacy Protection Act (COPPA).

Just $31 Million for Amazon?

Although $31 million is a meager sum for a company that reported revenues of $524.89 billion in 2022, it’s part of an ongoing effort by the FTC in recent months to bring significant privacy cases and set a precedent for the rest of the tech business. The FTC has racked up several privacy settlements with technology companies in 2023, including GoodRX and Premom. In both of those cases, the companies faced paltry fines that will do little to impact their businesses. In the Edmodo case, the company shut down during the FTC’s investigation, meaning there is no money for the government to collect.

Conclusion

Amazon agreed to pay just under $31 million to the Federal Trade Commission (FTC) for violating children’s privacy with its Alexa smart speakers and exposing Ring smart doorbell users’ videos. The FTC’s lawsuit against Ring alleges that it gave employees and contractors unrestricted access to users’ videos, which exposed Ring users to voyeurism and peeping toms. The lawsuit against Alexa alleges that Amazon misled parents about its children’s privacy practices, keeping their data forever and exposing them to potential data breaches.

The settlement is a part of the FTC’s ongoing effort to establish landmark privacy cases and set a precedent for the rest of the tech industry.

FAQs

What did Amazon do to violate children’s privacy?

According to the FTC’s lawsuit against Alexa, Amazon misled parents about its children’s privacy practices. Additionally, the company kept children’s data forever, exposed them to potential data breaches, and used their data for ulterior purposes.

What was the FTC’s lawsuit against Ring about?

The FTC’s complaint against Ring alleges that it gave employees and contractors unrestricted access to users’ videos, including third-party contractors with no special training about handling sensitive content. The lawsuit alleges that Ring users were subjected to voyeurism and peeping toms due to this lax approach to user privacy.

How much did Amazon pay in penalties?

Amazon settled both privacy cases with the FTC for just under $31 million. The Alexa case penalty amounted to $25 million, and the remaining $5.8 million was for the Ring case.

Did Amazon fire any employees after the FTC’s lawsuit against Ring?

Amazon previously said it fired four employees for inappropriately watching user videos.

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