News

Disturbing Trend: Social Media Companies Make Billions in U.S. Ad Revenue from Minors

3 Mins read

A recent study conducted by the Harvard T.H. Chan School of Public Health reveals a shocking truth – social media companies collectively earned over $11 billion in advertising revenue from minors in the United States last year. This alarming finding emphasizes the urgent need for government regulation of these platforms. It is evident that the companies, driven by profit, have failed to effectively self-regulate.

The implications of this trend are concerning, particularly for youth mental health. The researchers highlight the importance of implementing regulations and fostering greater transparency within the tech industry. By doing so, we can mitigate the potential harm caused by targeted advertising practices that specifically target children and adolescents.

To arrive at the staggering revenue figure, the researchers employed a meticulous methodology. They estimated the number of users under 18 on popular platforms such as Facebook, Instagram, Snapchat, TikTok, X (formerly Twitter), and YouTube for 2022. This estimation was based on data from the U.S. Census, as well as surveys conducted by Common Sense Media and Pew Research. To determine each platform’s ad revenue in 2022 and the time spent by children on these platforms daily, data from eMarketer (now known as Insider Intelligence) and Qustodio, a parental-control app, were utilized. The researchers further developed a simulation model using this data to estimate the ad revenue generated from minors in the U.S.

The detrimental effects of social media on children have long been a significant concern for both researchers and lawmakers. The algorithms employed by these platforms, tailored to individuals, can lead children towards excessive usage. In response to these concerns, legislation aiming to restrict social media usage among kids has been introduced or passed in states like New York and Utah. The focus is primarily on protecting youth mental health and addressing other related concerns.

It is worth noting that Meta (formerly known as Facebook) and its subsidiary Instagram, are also currently facing legal action initiated by numerous states for their alleged contribution to the mental-health crisis. This further underscores the urgency in addressing the negative consequences of social media usage on children and teenagers.

In conclusion, this study sheds light on the alarming reality of social media companies profiting immensely from minors. Government regulation, coupled with enhanced transparency within the tech industry, is vital to safeguard the well-being of our youth. Proper measures need to be taken to mitigate the potential harm inflicted by targeted advertising practices and excessive social media use among children and adolescents.

The Impact of Social Media Advertising on Children

Social-media platforms have been under scrutiny for their practices regarding the protection of young people. Despite claims of self-regulation, a study conducted by Harvard highlights their failure to take meaningful steps in safeguarding children. Additionally, the study reveals that these platforms have strong financial incentives to further delay any actions that would protect minors.

One notable aspect is the lack of transparency regarding the revenue generated from minors by these platforms. Unlike other forms of advertising to children, such as on television or in schools, online ads are particularly insidious due to their ability to specifically target children. Furthermore, it is oftentimes challenging for children to distinguish between advertisements and the content they actively seek out.

According to a policy paper released by the American Academy of Pediatrics in 2020, children have been recognized as uniquely vulnerable to the persuasive effects of advertising. This vulnerability stems from their immature critical-thinking skills and impulse inhibition. While school-aged children and teenagers may recognize advertising, they often struggle to resist its influence when it is embedded within trusted social networks or endorsed by celebrity influencers, or when it appears alongside personalized content.

The growing concerns surrounding social media’s impact on children’s mental health prompted the Federal Trade Commission to propose significant changes to a long-standing law governing online companies’ tracking and advertising practices towards children. The proposed changes aim to default the turning off of targeted ads to children under 13 and impose limitations on push notifications.

In terms of ad revenue derived from young users, YouTube ranked on top with $959.1 million, followed by Instagram with $801.1 million, and Facebook with $137.2 million for users aged 12 and under. For users aged 13-17, Instagram topped the list with $4 billion, followed by TikTok with $2 billion, and YouTube with $1.2 billion.

The researchers also analyzed the percentage of ad revenue derived from underage users for each platform. Snapchat had the largest share, with 41% of its overall 2022 ad revenue attributed to users under 18. TikTok followed closely with 35%, while YouTube accounted for 27%, and Instagram had 16%.

It is evident that social media advertising has a significant impact on children, both financially and psychologically. As the spotlight on this issue grows, it is crucial for social-media platforms to prioritize the protection of children and take necessary actions to mitigate the potential harms they face.

Related posts
News

HP Inc.'s Fiscal Results Insights

1 Mins read
HP Inc.’s stock experienced a 4% decline in extended trading on Wednesday following the release of their latest fiscal results that were…
News

Lawsuit Over Crown Castle Governance Rights

1 Mins read
Overview Crown Castle co-founder Ted Miller, along with his investment vehicle, has filed a lawsuit challenging an agreement between the company’s board…
News

The Demise of Defined Benefit Pension Plans

3 Mins read
Different Perspectives on ERISA’s Impact While many view ERISA as a contributing factor to the decline of defined-benefit (DB) plans, others argue…

Leave a Reply

Your email address will not be published. Required fields are marked *

− 4 = 4