Tech giant Meta will pay up to roughly US$18 billion , plus make major design changes to Facebook and Instagram, as part of a settlement it has agreed to in its most recent lawsuit .
Author
- Rob Nicholls
Senior Research Associate in Media and Communications, University of Sydney
Filed in 2023 by a coalition of 29 US state attorneys-general, the case alleged that Instagram and Facebook were engineered to keep teenagers hooked, that Meta misled the public about the harm, and that it collected data from children aged under 13 without parental consent.
The trial began just over a week ago. But instead of battling it out in court for four more weeks, the parties agreed to settle .
Even though Meta folded in this case, the settlement doesn’t amount to an admission of wrongdoing, liability or violation of any laws. In a statement , Meta said:
Ensuring teens have a safe and productive experience on our platforms is an absolute imperative for Meta. We want to get this right for parents and teens, and that’s why we partnered with state attorneys general to set a new industry standard.
Why settle now?
This year has been brutal for Meta in court.
In March, a Los Angeles jury found Meta and YouTube liable for harming a young woman who joined Instagram at the age of nine.
The same week, a New Mexico jury found Meta had endangered children, ordering it to pay $567 million to address the youth mental health crisis. In August, a judge lifted that bill to $942 million .
In this most recent case, Meta said the states were seeking as much as $1.4 trillion in penalties. The states denied this, saying the maximum penalties could reach roughly $200 billion.
By settling now, Meta buys certainty and a cap on its public exposure. The states get money and product changes that no legislature has managed to pass.
The money has two layers. Meta will pay roughly $11.7 billion to 47 US states, plus the District of Colombia and three US territories, in ten annual instalments, as well as $1 billion to Texas as part of a separate legal agreement . It will pay a further US$5.3 billion only if TikTok, YouTube and Snap sign up to the same rules and pay their own share.
How Instagram and Facebook will actually change
For “Teen Users” – that is, anyone Meta believes is aged 13-17 – in the participating jurisdictions, the agreement will establish a night mode which blocks access to Facebook and Instagram from midnight to 6am by default, and silences notifications from 10pm to 7am.
A two-hour daily cap applies across both apps combined, although messaging and longform videos that are at least 22 minutes long will not count. Essentially, this draws a line between something that resembles watching a TV show and something that resembles scrolling.
A teen with three Instagram accounts does not get six hours. Meta must link accounts using device IDs and phone numbers.
During school hours (8am to 3pm on weekdays), notifications are muted. Forced breaks appear at 60 and 90 minutes of daily use, with a nudge after 15 minutes of continuous scrolling. Only a parent linked through Meta’s supervision tools can loosen any of these defaults.
The agreement then turns to design. “Like” counts are hidden by default, and “cosmetic procedure filters” are switched off. Filters that reshape your face in ways only surgery could are out. Puppy ears and cat faces are fine. Teens must be offered a non-personalised feed (posts in time order rather than chosen by an algorithm) within ten days of joining and every 90 days after.
Finally, the agreement deals with who is on the platform and what happens to them there. Every user must be age-checked within a year, using tools tested against the international standard .
No more than 10% of 16- and 17-year-olds, and 3% of 13-15-year-olds, may be wrongly classified as adults. Failing to meet these service levels, as determined by an independent auditor, is a breach of the judgement and risks contempt proceedings.
Reports of harmful content must be answered within six hours in 90% of cases. Parents are notified the first time their teen messages an adult, and if the teen repeatedly searches for suicide, self-harm or eating disorder terms.
The auditor will report for five years, and Meta is barred from making misleading claims about its safety features.
Why this matters beyond the US
So far, other countries have taken a different approach to tackling big tech.
Many countries have been looking to Australia, where social media platforms such as Facebook and Instagram are required to take “reasonable steps” to stop under-16s from having accounts.
The new settlement in the US instead accepts 13-year-olds can use social media and regulates the design of the platforms.
Where these two approaches overlap is age assurance – working out how old someone is without asking for a passport. Australian law requires “reasonable steps”; the new settlement in the US sets an error threshold of 10% and 3% for the two respective age categories, tested annually by an outside expert.
The US measures may in turn feed back to Australia, where error thresholds might be incorporated into assessments of age restrictions and the promised response times to reports of harm could influence law reform.
A big question is whether the changes agreed as part of this settlement will spread to other platforms.
The settlement is designed to make this happen: Meta pays the final $5.3 billion only once “industry-wide adoption” occurs, which the agreement defines as Snap, TikTok and YouTube being bound by equivalent rules through settlement, legislation or audited voluntary compliance. That is the same domino logic as the 1998 settlement between 52 US state and territory attorneys-general and the country’s four largest tobacco companies.
If this happens, the night block will widen to 10pm to 7am and the daily cap would drop to one hour per app.
Meta has published an open letter urging TikTok and YouTube to join “right away”, with chief legal officer C.J. Mahoney arguing that “teens move fluidly across dozens of apps”.
Whether TikTok and YouTube can resist the rules that Meta has accepted is the question for the next 12 months.
