Even if one were to figure out just how to target the clinically-paranoid parental market, I doubt there's enough daylight between this idea and the cell phone. Cell phones are in continuous contact with authorities and come with video and audio. But kids actually want to carry cell phones. Having a cell phone gives you capabilities. Wearing a single-purpose electronic leash that's attached to your mom just leads to embarrassment.
Could one market this to the parents of kids too young for cell phones? What kid is that, exactly? Infants don't roam very far, and any kid older than three can use a cell phone. That cell phone will almost certainly be cheaper than this device, and the kid that can be trusted not to break, lose, or perpetually forget to carry this device can probably also be trusted with that cheap cell phone.