Key facts
- Meta Platforms will pay up to $18 billion over 10 years to settle lawsuits with 51 U.S. states, Washington D.C., and territories.
- The settlement addresses allegations that Meta's social media platforms harmed children through addiction and privacy violations.
- New child safety features will be implemented, including default daily time limits, night-time blocks, and hidden likes.
- Meta denied wrongdoing as part of the settlement.
- Approximately 30% of the payout is contingent on rival platforms accepting comparable obligations.
Meta Platforms has agreed to pay up to $18 billion over a decade to settle lawsuits with nearly all U.S. states, Washington D.C., and territories, resolving allegations that its social media platforms were designed to addict children. The company denied wrongdoing as part of the agreement, which also mandates new child safety features, including time limits and hidden likes on Facebook and Instagram.
The settlement, described as Meta's largest payment to date for such litigation, aims to remove a significant regulatory hurdle and avoid a lengthy trial. While the headline figure is substantial, analysts suggest it is unlikely to strain Meta's business, which generated over $60 billion last year, as it leaves the core personalized advertising model untouched.
Some experts believe Meta structured the settlement to pressure competitors like TikTok, YouTube, and Snapchat, as a portion of the payout and stricter limits are contingent on rivals accepting comparable terms. This move places Meta and state attorneys general on the same side against competitors, potentially impacting their market positions.
Despite the settlement, Meta faces ongoing legal challenges, including separate lawsuits from New Mexico and Florida, and scrutiny from the European Commission over content-moderation laws. Doubts also persist regarding the effectiveness of the new guardrails Meta plans to implement.