News report featured image, three children on phones, social media usage

Social Media’s $11 Billion Revenue from Minors: Impact and Need for Regulation

Dec. 31, 2023 7:31 pm PST | SEO Gazette | By Luke Ross

Overview of Harvard’s Groundbreaking Study

A study published on December 27, 2023, by the Harvard T.H. Chan School of Public Health, as reported by The Mercury News, reveals a staggering figure: social media companies have collectively generated over $11 billion in U.S. advertising revenue from minors in 2022. This finding yet again brings to light the urgent need for government regulation and greater transparency in the social media industry, particularly concerning the protection of children and adolescents from potentially harmful advertising practices.

Methodology Behind the $11 Billion Revelation

The researchers estimated the number of users under 18 on major social platforms like Facebook, Instagram, Snapchat, TikTok, X (formerly Twitter), and YouTube using U.S. Census data, surveys from Common Sense Media and Pew Research, and ad revenue data from Insider Intelligence and Qustodio. They developed a simulation model to calculate the ad revenue earned from minors. The study highlights the financial incentives for social media platforms to delay implementing measures that protect young users.

Detailed Revenue Analysis: Platforms Profiting from Youth

  • YouTube earned the most ad revenue from users aged 12 and under ($959.1 million), followed by Instagram ($801.1 million) and Facebook ($137.2 million).
  • For users aged 13-17, Instagram topped the list with $4 billion, followed by TikTok ($2 billion) and YouTube ($1.2 billion).
  • Snapchat derived 41% of its total 2022 ad revenue from users under 18, the highest proportion among the platforms.

Contextualizing the Mental Health Concerns

Lead author of the study and an instructor at Harvard Medical School, Amanda Raffoul PhD, MSc, stated, “Our finding that social media platforms generate substantial advertising revenue from youth highlights the need for greater data transparency as well as public health interventions and government regulations.”

This revelation comes amid growing concerns about the impact of social media on youth mental health. Social media platforms, known for their personalized algorithms, can lead to excessive use among children, potentially exacerbating mental health issues. States like New York and Utah are considering legislation to curb social media use among kids. Meta, the parent company of Instagram and Facebook, faces lawsuits from several states for its alleged role in the youth mental health crisis.

The Persistent Challenge of Advertising to Children

The American Academy of Pediatrics has expressed concerns about children’s vulnerability to advertising, noting that even if they recognize it, they may not resist it effectively, especially when it’s embedded in social networks or delivered alongside personalized content.

FTC’s Regulatory Response to Protect Young Users

In response to these concerns, the Federal Trade Commission (FTC) has proposed significant amendments to laws regulating online tracking and advertising to children. These changes include disabling targeted ads to children under 13 by default and limiting push notifications.

The Future of Youth Protection Online

The Harvard study sheds light on the substantial revenue social media companies earn from minors, raising questions about their commitment to self-regulation and the need for stricter oversight.

As the debate over the impact of social media on youth continues, this study provides critical data for policymakers, parents, and educators grappling with the challenges of this new era of social media and internet usage.

Article written by Luke Ross, SEO Gazette

Copyright Disclaimer: Under section 107 of the Copyright Act of 1976, allowance is made for “fair use” for purposes such as criticism, comment, news reporting, teaching, scholarship, education and research. Fair use is a use permitted by copyright statute that might otherwise be infringing.

Any references to other articles, information, or images are purely for the sake of discussion and analysis. We do not hold any rights to images or external content referenced, and we disclaim any liability arising from the use or application of the information provided herein.