Why it matters: TikTok, the short-form video platform and social network that was formerly known as Musical.ly, has agreed to pay a $5.7 million settlement over FTC charges for illegally collecting the personal information of children.

According to an FTC press release, the app’s operators' failure to obtain parental consent before collecting personal information on those under 13 put them in violation of the Children’s Online Privacy Protection Act (COPPA).

The FTC complaint claims the “operators of the Musical.ly app were aware that a significant percentage of users were younger than 13 and received thousands of complaints from parents that their children under 13 had created Musical.ly accounts.”

Bytedance, the Chinese parent company of TikTok, purchased Music.ly in November 2017 for between $800 million and $1 billion and rolled it into the app. More than 200 million users had downloaded the Musical.ly app worldwide since 2014, and 65 million accounts have been registered in the United States. Over 500 million people now use TikTok.

Creating an account in the app involves adding an email address, phone number, username, first and last name, a mini-biography, and a profile picture.

In addition to the $5.7 million payment, which is the largest-ever civil penalty obtained by the commission in a children's privacy case, TikTok must take all videos made by children under 13 off its platform.

TikTok has responded to the news by announcing the launch of a separate in-app experience for those under 13 that “does not permit the sharing of personal information, and it puts extensive limitations on content and user interaction.”

“In the younger ecosystem, users cannot do things like share their videos on TikTok, comment on others’ videos, message with users, or maintain a profile or followers,” the statement adds.

The company has also released a series of safety videos.

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