Full article here, but you need to sign up for a free account to read it.
The relevant bits:
Herbert S. Lin, a senior scientist at the National Academy of Sciences who recently jointly edited a report on the Internet and risks to children, affirmed how difficult it is to make secure, compelling sites for children into a successful business. "There wasn't a large amount of online material or Web sites that were really good for kids,'' he said. "There's just no money in doing that. So kids are stuck, wandering around."
In addition to random wandering, many children and teenagers with a need to express themselves have begun keeping online diaries and Weblogs, known as blogs. They go to places like The Student Center (www.studentcenter.org) and Livejournals.com (www.livejournals.com) and post page after page of personal chronicles.
The Student Center has more than 1,000 diaries and as many blogs. (Diaries tend to be more personal than blogs.) Jeff Edelman, president of The Student Center, whose revenues come from advertising, said one safety method he uses is to allow diaries to remain completely private, essentially providing diary-creation tools.
Yet because of the cost of monitoring to keep personal information off the site, Mr. Edelman said, no one under 13 - the age under which the Privacy Protection Act applies - is allowed at the site. Nor does LiveJournal permit anyone under 13 to visit the site.
Mr. Rettstatt said he planned to offer password-protected online diaries to KidFu members by early next year. "There's a definite need for it," he said. He said he and his staff would screen all diary contents before putting them online, as they do with the rest of the material on the site.