Rethinking kids, COPPA and online safety

Do you let your kids use Facebook? MySpace? Club Penguin? Webkinz? How about Imbee, KidsWorld, Togetherville, Everloop or Yoursphere?

Maybe you haven’t even heard of some of these sites. Which is too bad, since most are terrific and offer wonderful, safe online experiences for young children. Believe it or not, the tween space online is extremely competitive and has been for a long time. It’s also extremely difficult to create a sustainable business model. But not everyone knows that. On more than a few occasions, I’ve received calls from the CEOs of promising new startups, business plan and beta website in hand, claiming “we’re going to be the next Facebook for kids under age 13!”

The question we should all be asking ourselves is: do parents – or kids for that matter – even need or want a “Facebook for kids?” Isn't it just easier to lie about your kid's age? But wait - what kind of message does that send?

This recent NPR article, Social Networks: Thinking of the Children, got me thinking. The conversations still very much focuses on online safety. But is that even the main decision factor for parents?

When COPPA was enacted back in 1998, I was running a website for tweens called FreeZone.com. Online safety was a big deal for us and we worked closely with the FTC and CARU in getting it right. Chats were monitored. Ads were labeled. We had each and every parent fax in a signed registration form before we'd allow their kids to interact on the site. Yup, pretty labor intensive. Maybe that's why the site isn't around anymore.

We wrote to the FTC in 1999: “Our business is based on the highest possible safety and privacy standards that have become our competitive advantage in drawing kids into the FreeZone community. We are eager for technology to catch up to our standards, so we can implement more convenient and cost-effective ways to gain parental consent.”

Today online safety PSAs abound. It seems like there isn't a day or an hour that goes by without a well-informed article about online safety, cyberbullying, sexting,"Facebook depression," predators and the like. The general public is more aware. Yet COPPA hasn't changed since 1998. It's clunky and it forces tween sites to stay within antiquated boundary lines, creating a permissions process that is a pain in the ass for both parents and website developers. Meanwhile, Facebook is allowed to keep paving the way into the 21st century simply by stating that their site is open to anyone over 13 years of age. Leaving parents two choices:

1. Lie about my child's age and let them go on Facebook, where I will keep tabs on what they are doing.

Or

2. Let them play around on one of the tween sites listed above, safely, of course - which means active, parental involvement.

Hmmm.

Actually, there's a third choice: Skip any sort of online social networking until the child turns 13.

Crazy? That's what I'm going to do. Easy for me to say. I've got an 8 year-old and a 4 year old (neither of whom has expressed any interest in Facebook let alone any other social networking site) so ask me in a few years. Maybe this whole dilemma will be solved by then.

As the 'real world' gets worse, virtual words get better

If you're like every other adult I know, you're obsessing about the economy right now. Things, um, don't look so great. I've tried to put my head in the sand over the whole debacle, but this recent Forbes article caught my eye: 

"Despite all the doom and gloom, one tiny sector is offering a glimmer of hope: virtual worlds. Companies such as Gaia Interactive and Habbo (targeting tween and teen girls) are expecting a boost as consumers reduce spending on real-word goods and console themselves with so-called virtual goods." 

Really?

At first you might think that this is just another example of how parents are continuing to indulge their children with consumer goods (albeit virtual ones) but the psychology actually runs deeper than that. "As things get worse, people spend more time at movies or spend more time on a site like Gaia Online, which provides a relatively inexpensive respite from the offline world," says Gaia Chief Executive Craig Sherman.

Other kid-targeted virtual worlds like Club Penguin and Neopets have seen similar results. Teen-focused Habbo.com reports that 85% of the site's revenues come from virtual world transactions. This site's 2.5 million U.S. users spend an average of $18 a month on virtual goods and spend nearly 40 minutes on the site.  From a teen perspective, when you compare this to say, a trip to the mall--including the high costs of gasoline, food and premium denim-- well, the virtual world begins to look like a pretty great bargain.