H5Kids, the premium fun and toy review channel hosted by Charley and Pepper, discusses how the latest YouTube policy on kids' videos has affected them negatively.

With active 2 billion monthly users, YouTube is the world's biggest online video source. However, a huge number of the billions of videos viewed on the site are aimed at kids. A study even suggests that kids' content may be the most-watched video category overall because of the fun. However, YouTube has come under fire for a range of scandals involving children, with the company paying $170 million penalties because of the data they collected, without the consent of their parents.

Because of this fine, YouTube came out with COPPA-compliance rules that started from Jan 6 which has caused a major setback for channels that produce kids’ contents. The rule stipulates that video contents meant for kids must be designated with “made for kids.” The rule will involve YouTube limiting the data it collects for videos marked as “made for kids” under the government settlement.

According to this rule, YouTube videos marked as “made for kids” will not be able to include targeted advertising. Also, other features that depend on user data including comments, live chat and live chat donations; channel branding watermarks; the “donate” button; cards and end screens; notifications; and or “watch later” or “save to playlist” have been disabled.

This rule has affected H5Kids, with their CPM dropping by almost 80% despite the fact that views, watch time, subscribers have remained steady. Data obtained from analytics shows the CPM dropping to $1.47 compared to this particular time last year where it was $3.62 CPM.

“Content creators work really hard on something, and they probably don’t know if it will be monetized or how it’s going to be treated by the algorithm. That can cause emotional crises because you have to start worrying about whether what you’re doing is a complete waste of your time economically or not. YouTube is always protecting itself but at the expense of the creator community which is not pleasant. ” Spokesperson for H5Kids commented.

H5Kids would like to display its contents on YouTube kids and hopes to be more profitable because they’re always working hard. For more information, please visit http://youtube.com/h5kids.