4 posts tagged “legal”

Tomorrow marks the 1 year anniversary of the publication of one of my most popular posts to date: "Using Social Media to Sell Products to Kids...Interesting but Potentially Dangerous."  In that post, I talk at length about how toy manufacturer Ganz is using the internet and social networking principles to market and promote its very popular Webkinz toys to 6-11 year old children.  I expressed concern that the FTC and Children's Online Privacy Protection Act (COPPA) aren't enough to protect kids:

Companies are marketing to children, soliciting information from them on-line, and asking them to read legal agreements, which are beyond their level of comprehension.  It is difficult for parents to watch out for their kids in situations like this.  If a kid thinks it is okay to input their information onto, say, the Webkinz’s site without parental permission, what is to say that same child won’t think it is just as okay to give that information to a stranger via another website?  Nothing, unless their parents are involved.

In response to that article, I've gotten dozens of emails and a handful of comments from parents, internet professionals, teachers, and others, all of whom agreed with the concerns I raised.  I was also pinged by a nationally syndicated TV morning show who was thinking of doing a story on the topic.  And despite all of this 'concern', in February of last year, The Toy Industry Association awarded Webkinz the "Specialty Toy of the Year 2007," and Webkinz and Lil'Kinz (another Ganz toy) are still hugely popular (and now collectible).  In fact, as recently as January 8, 2008, a retired Webkinz "Cheeky Dog" sold on eBay for $735!

Today, I received a "comment" on my original post from a divorced dad of four who expressed concern that his ex-wife is using Webkinz to "babysit" their eight year old.  "Hank," who works with computers and the internet for a living, defines his eight year old as a "Webkinz Addict."  His son has lost interest in "normal" kid activities (Boy Scouts, Little League, etc.) in favor of playing entirely with his 55 Webkinz toys, a trend which is "encouraged" by his mother:

This past Christmas, [my ex-wife] "promoted" that all should buy a specific Webkin to assure no duplicates! In gross dollars, the child received over $700 worth of Webkins, less than $40 worth of other toys and less than $50 worth of clothing!

How does Hank know how much his eight year old's other presents cost?  It sounds like Hank was the only family member that bought his son something besides Webkinz for Christmas.  I encourage you to read Hank's comment in its entirety. It's both frightening and sad.  It also re-emphasizes the importance of good parenting and the need for every parent to understand the potential dangers of the internet and toys that encourage their young kids to use it.

Hank's comment also re-emphasized my believe that the Children's Online Privacy Protection Act (COPPA) doesn't do enough to protect young kids whose parents don't know how to protect them from the internet.  It's easy enough to point the finger at parents to say that they're at fault for exposing their kids to the net, but it's also not entirely fair.  Most parents don't understand the dangers of the internet as well as they should, and the landscape is constantly evolving, which makes it hard for them to 'keep up'.  Most parents think that the 'danger' is in their kids stumbling across porn or sexual predators on-line, but internet marketing should be a concern as well, especially since children under 13 are extremely vulnerable to suggestion. 

The Webkinz website describes the toys as:

lovable plush pets that each come with a unique Secret Code. With it, you enter Webkinz World where you care for your virtual pet, answer trivia, earn KinzCash, and play the best kids games on the net!

Parents must see the Webkinz marketing copy and think they're getting their kids a great educational toy.  And yet, after listening to the explanatory 'tour' on the Webkinz site, I can't help but think that that the Webkinz proposition encourages an unhealthy level of consumerism and the kind of compulsive behavior exhibited in gambling and/or shopping addiction. 

Kids are encouraged to make "Kinz Cash" by playing games in an 'arcade' and entering 'contests'. They can use this cash to 'decorate' their Webkinz's virtual room. If they don't take care of their Webkinz by going back to the site ton a daily basis, the "health" of the Webkinz will deteriorate. Kids are encouraged to 'chat' with their real-life friends' Webkinz on the forum and to buy more Webkinz so that they can have more fun on the site ("Collect them all!" says the tour).  Given what a time suck the Webkinz site appears to be, I can't imagine any parent having enough hours in a day to supervise their child 100% of the time on the site and still have the child complete all of the tasks/ things that there are to do on Webkinz.  More likely, parents are, as Hank describes it, using Webkinz's website as a babysitter, while they do other things around the house, assuming that the site is an 'educational' tool and perfectly harmless to their child's well being.

Looking at the list of symptoms for "Pathological Gambling" as defined by the American Psychiatric Association (APA) in conjunction with listening to the 'sales pitch' on the Webkinz site, I can't help but think that would be easy for a child to develop a Webkinz addiction like the one Hank described.  The APA says that having 5 or more of the following symptoms constitutes having a gambling problem:

• Preoccupation with gambling-related thoughts, plans or activities;
• Needing to gamble with increased sums to produce the desired excitement;
• Restlessness or irritability when attempting to cut down or stop gambling;
• Gambling to escape from problems or relieve an undesired mood such as helplessness, guilt, anxiety or depression;
• After losing money gambling, often returning to try to win it back (chasing losses);
• Lying to conceal gambling activities or consequences;
• Committing illegal acts to finance gambling;
• Jeopardizing or losing a significant relationship, job, educational or career opportunity because of gambling;
• Relying on a “bailout” (money from others to relieve a desperate gambling-related financial situation);
• Having made repeated unsuccessful attempts to control, cut back or stop gambling.

By supplying a unique cocktail of arcade games, necessary dependency on the site (your Webkinz will suffer if you don't take care of it daily by visiting the website), and ways to earn and spend cash, I wonder if the Webkinz site and product philosophy have the potential to encourage a child (like Hank's son) to rack up 5 or more of the above symptoms (or variations of them).  I don't have the same concern for 13 year old + focused social sites like Facebook and MySpace because:

• A user's online experience doesn't deteriorate if s/he doesn't check into the site on a daily basis.
• Users aren't required to earn money in a fake currency to purchase things on the site (though apps like AceBucks give users the option of earning/spending fake currency).
• The point of these sites isn't to play games (though users can do that). It's to stay in touch with friends.
• These sites are "free" and supported by advertising, which I'd hope 13+ year olds have at least some cognitive ability to filter.

(Though, there are other potential hazards for 13-18 year olds on some social networking sites.)

Thinking about WebKinz reminds me of the Joe Camel debate of the early 90s*  Just because something looks like it should be for kids, doesn't mean that it's good for kids.  In the constantly evolving world of social media and online marketing, it's tough for the average parent to tell the difference.  There's a fine line between teaching kids about the internet in a safe way, coddling them/ being over-protective, and exposing them to things online that could be harmful.  I'd love to hear what a child psychologist with a strong knowledge of web 2.0 thinks about Webkinz.

*According to Wikipedia: "Joe Camel was a controversial cartoon camel that primarily appeared in advertisements for Camel, but also appeared on "Camel Cash" and a number of origami Pop-up print ads. Joe Camel came under scrutiny as some considered use of the character to be advertising directed at children."

I’ve talked a lot in this blog about how companies are using social media to capture new customers and engage existing customers.  Today, Advertising Age wrote a fascinating article on the success of Canadian toy manufacturer, Ganz, who has used social media and the Internet to spark massive sales of its Webkinz stuffed animals.  I’ve got mixed feelings about Webkinz marketing model and success. On the one hand, I admire the Ganz creativity. On the other hand, I question whether Webkinz takes marketing to children one step too far.  Before I explain this paradox in more detail, here’s some background…

Webkinz, which launched last year, are proving exceptionally popular among American children aged 6-11.  The success of Webkinz is so impressive that Advertising Age refers to them as “Beanie Babies on steroids”.  By November 2005, Ganz had sold one million Webkinz, without doing any formal advertising.  Ganz reports that this number was pushed “significantly higher” during the holiday season.  Instead of advertising, Ganz made Webkinz successful  by engaging a strong network of sales reps and retailers as well as innovative PR and social media strategies.  Bloggers and YouTubers started talking about Webkinz en-masse, which attracted the attention of the media and resulted in publicity on "Good Morning America," "Regis & Kelly" and "Rachael Ray."  Social media combined with the power of traditional press accelerated the sales of Webkinz.

Webkinz word of mouth success via social media is in great part to do with its web-savvy product strategy.  Each Webkinz stuffed animal comes with a printed tag, with a secret code and the address of what Advertising Age refers to a “safe” social-media enabled website for kids.  Once registered, kids can dress and feed their avatar Webkinz by earning “KinzCash” by playing games and winning quizzes.  Kids can also engage their avatars with other Webkinz avatars by inviting them to be friends and sending messages from a pre-selected list of options (Advertising Age uses the example “You are” and “very nice”.).  So, in effect, the Webkinz site becomes a mini MySpace for very young kids, without the threat of sexual predators. Imagine the success of Cabbage Patch Kids in the 1980s, and add to the “adoption process” the power of the internet and talking cartoons, and it’s not hard to see why kids can’t get enough of Webkinz.

The concerning part of Webkinz and similar products is the way that they engage with and solicit information from children.  When a child goes to the Webkinz site s/he is greeted by vivid cartoon images and written instructions.  When the child clicks on the text “My First Adoption,” a cartoon named “Ms. Birdy” appears welcoming the child to the “Adoption Center.” Ms. Birdy asks the child to read and complete the end user license agreement (EULA).  Webkinz’s EULA is a typical legal masterpiece.  It contains text that is well beyond the reading comprehension level of a 6-11 years old, and yet, without suggesting that the child ask for parental assistance, “Ms. Birdy” asks the child to read and agree to the terms contained within the EULA.  Included in the terms is a paragraph, which says that any feedback provided to Danz on the site will become the intellectual property of Danz. I understand why Danz has this clause in the EULA, but I don’t feel that it is appropriate to expect that a child can read or understand a legal document intended for adults. I take issue with any website that expects a minor-aged child to click through and agree to a legal agreement without parental involvement – especially one that claims ownership of any intellectual property that the child submits in the form of feedback for the site.

After the child clicks “I agree” to the EULA (which they couldn’t possibly understand), Ms. Birdy speaks, telling the child that if s/he is under 9 years old, her/his parents should help her/him with registration.  The site then asks the child to submit personal information into the website: first name, date of birth, country of residence, and state. Although, it is not considered personally identifiable, this information does not appear to be transmitted securely, which is concerning to anyone illegally watching a family’s internet activity or a child predator stalking kids at the local library.

The child is then asked to create a username and password and submit the secret code on the tag of their Webkinz animal.  This code allows the child to play in “Webkinz World” for one year from the “date of adoption,” with the option to renew after that year for a fee.  All of this, is, of course, explained in the EULA, which is too complex for a child to understand. 

While I am excited to see social media being used as an effective marketing tool, and I am pleased that DANZ complies with the Children’s Online Privacy Act (COPA), the Webkinz registration issues I mentioned highlight a larger issue of concern.  Companies are marketing to children, soliciting information from them on-line, and asking them to read legal agreements, which are beyond their level of comprehension.  It is difficult for parents to watch out for their kids in situations like this.  If a kid thinks it is okay to input their information onto, say, the Webkinz’s site without parental permission, what is to say that same child won’t think it is just as okay to give that information to a stranger via another website?  Nothing, unless their parents are involved.
 
One of the things that should be of growing concern to social media enthusiasts and child advocates alike is that there is currently no safe way to identify whether someone is a minor on-line.  Having a “second life” full of social media and networking on-line is becoming more and more common. In so many ways, anonymity is an accepted part of the Internet. This may hurt kids.  By this I mean, in real life, a child can’t go into a 7/11 to purchase porn, cigarettes, or booze, without showing appropriate age identification.  However, on-line, there is no such thing as an age identification. The Internet is largely anonymous.  As a result, there is no way to protect kids from seeing or interacting with inappropriate material, as there is in the non-anonymous “first life” – unless that material costs money and requires a credit card to purchase. A scary thought.

Thanks to technology and the Internet, the world is becoming increasingly transparent and accessible.  Social media is playing an important role in this transformation.  So far, most people seem to be responding to the power of social media favorably, and they’re using the power of social media for good.  However, there is a risk that the pendulum could shift in the other direction over time.  Below are the "5 Deadly Sins" of social media - pitfalls that proponents of social media should watch out for and proactively advocate against:

• Market saturation: There is a proliferation of social networking sites available – lots of sites are competing for users time.  Marketers are creating new social networking sites in record numbers to promote their products, and the number of traditional social networking sites (MySpace, YouTube, Bebo, Gather, WAYN, CyWorld, etc.) are also growing.  Users often use different for the same purpose but to meet different people.  If the market becomes overly fragmented, it may become less useful and more burdensome to user.  I hope that a natural market consolidation will happen eventually, but in the meantime, the industry runs the risk of users “burning out” from having to juggle too many different websites, on-line “friends”, different profile inputting tools, and passwords.
• Exploitation of social media at the expense of others: Social media makes it easier than ever to share information on-line.  While, the power of information sharing is good, it can also be dangerous in the wrong hands, enabling: fraud, misrepresentation of identity, identity theft, sexual exploitation, and unethical sharing of corporate or government secrets.  I just read an interesting article on the security risk that social media presents to corporations.  The same is true for governments and individuals.  The “Star Wars Kid”  and Paris Hilton were two of the first people to learn a thing or two about that.
• Eradication of privacy: This one is closely linked to the bullet point above on exploitation, but I felt it deserved its own section because it goes beyond exploitation because what is considered private to one person, isn’t necessarily considered private to another.  The Washingtonienne case is a good example of this.  Another example is that anyone can get an aerial photograph of your house at Google Maps or go to Zillow to find out what your house is worth.  Add location based social media services and mobile phones into the mix, and tracking people's location becomes easy via services like Helio's Buddy Beacon and Dodgeball.  While these are great services and they offer opt-in privacy, it's scary to think what could happen if either service were hacked.  Alternatively, imagine the damage that would result if someone's location information got into the wrong hands or was commandeered by a "friend" turned stalker. 
  
• Opportunistic litigation: Lawsuits like those filed earlier this week against News Corp. pose a strong threat to the health of social media.  If cases like these succeed, the rulings will send a dangerous message to the public: “You’re not responsible for your own safety or the safety of your children.  Someone else is.”  Unjustified lawsuits also stifle technical innovation and have the potential to strangle social media with excessive amounts of red tape.
• Opaque Marketing: Marketers are becoming more sophisticated about the ways that they use social media to their advantage.  It is already difficult to avoid pop-ups and other advertisements on-line.  And, with some social media sites, it difficult to tell what is advertising versus what is genuine, unbiased opinion.  Take, for example, bloggers who get paid by companies to evangelize products (I don’t, but a lot do).  Advertising on social media sites isn’t nearly as transparent as it should be, and social media runs the risk of being tarnished by overzealous marketers.

1/22/07 UPDATE: Thanks everyone for your insightful comments.  I just read a great article by Mark Zielinski, a UK-based security engineer.  The article talks about the threat that social media poses to corporate security.  In the article, Mark talks about how employees use their work computers to check their social networking pages and that this poses a threat to corporate networks.  Unsurprisingly, employees checking social media sites rather than doing work probably, has an impact on productivity - even more so than personal email. With these two points in mind, I'd like to add "Bringing Down the Corporation" as the 6th deadly sin of Social Media.

Today, the Associated Press reported, that four families filed separate lawsuits against News Corp (MySpace), claiming that their 14 and 15 year old daughters were sexually assaulted by pedophiles they met on-line.  The families, located in New York, Texas, Pennsylvania and South Carolina, are seeking millions of dollars damages, claiming that MySpace didn’t initiate strong enough security measures to protect their children from solicitation from adults. Jason A. Itkin, a lawyer with Arnold & Itkin, one of the law firms representing one of the suits said:

"In our view, MySpace waited entirely too long to attempt to institute meaningful security measures that effectively increase the safety of their underage users… Hopefully these lawsuits can spur MySpace into action and prevent this from happening to another child somewhere.”

These lawsuits aren’t the first of their kind.  In June 2005, a mother in Texas sued MySpace and News Corp for $30,000,000 in damages, claiming that her 14-year old daughter was sexually assaulted by a 19 year old man, who it is alleged, lied to the girl by claiming he was a senior in high school and luring her into a false sense of trust.

In response to the lawsuits filed today, Hemanshu Nigam, MySpace's chief security officer, issued a statement saying:

MySpace serves as an industry leader on Internet safety and we take proactive measures to protect our members… We provide users with a range of tools to enable a safer online experience.

Nigam went on to discuss the responsibility of users and their parents to “engage in open family dialogue” about on-line safety, transferring valuable off-line lessons to on-line interactions.  The most recent step in the right direction came when MySpace announced that it would introduce parental notification.  (I'll be interested to see how that works.)

While it is a sad reality that creepy people (including sexual predators) exist and that pedophiles use social networking sites to target children, I agree with Nigam.  Social networking websites must take security seriously.  However, it is right to blame social networking sites for the criminal activity of their members.  Doing so devalues the importance of parental responsibility, stifles technical innovation within social media, and perpetuates what is already an overly litigious culture in America.  

Criminals are to blame for their own criminal behavior.  Parents have the responsibility to educate themselves and their children about the dangers that exist on-line and talk about how to avoid them.  The tough part is that because technology and “what’s cool to kids” changes quickly, it is difficult for the average parent to keep up to speed.  

Organizations like Perverted Justice are doing their part to seek out on-line predators.  I wonder whether the world would benefit from a new, multi-national public-private partnership, whose aim is to educate parents and kids about the dangers that exist on-line (how to avoid them, how to report suspicious or unlawful behavior, etc.).  Regionally, members of this partnership could focus on developing legislation that protects kids.  I’d like to believe that this idea could work, but I’m realistic enough to know that it would be an uphill battle, likely fraught with bureaucracy and red tape.  

Citizens of the world have identified a problem that is crying out for a strong, targeted, and evolving solution. While I don’t propose to know what the answer is, suing MySpace isn't it.

If you have ideas, post a commment. If you aren't a VOX user and want to tell me what you think, email me: socialmediablog@gmail.com.