Harvard Study Reveals Social Media Companies Made $11B in US Ad Revenue From Minors

A recent Harvard study has found that social media companies have together made over $11 billion in U.S. advertising revenue from minors, according to The Associated Press.

These findings shed light on the need for government regulation of social media as the companies benefiting from children on their platforms are not adequately self-regulated. The study highlights that regulations combined with more transparency from tech companies could lower mental health concerns and prevent potentially harmful advertising practices targeting children and adolescents.

Researchers of the study estimate that YouTube turned over the largest ad revenue of $959.1 million from users who are 12 and under, followed by Instagram, which generated $801.1 million, and Facebook, which made $137.2 million. However, Instagram generated the most ad revenue from users ages 13-17 at $4 billion, followed by TikTok at $2 billion and YouTube at $1.2 billion.

Based on population data from the U.S. Census and survey data from Common Sense Media and Pew, researchers predicted the number of users under 18 on Facebook, Instagram, TikTok, Snapchat, X (previously Twitter), and YouTube in 2022 to work out the revenue figures. Following this, they utilized data from research company eMarketer (now called Insider Intelligence) and Qustodio, a parental control app, to work out an estimate of the U.S. ad revenue for each platform and how much time children spent on each one. Once completed, the researchers built a simulation model using the data to estimate how much ad revenue the platforms earned from minors in the U.S.

For a long time, researchers have focused their work on the negative impacts of social media platforms, as they have been designed with an algorithm that leads children to overuse them and become hooked. However, this year, lawmakers in certain states in the U.S., such as New York and Utah, introduced or passed legislation that would put a cap on social media use for kids due to its impact on their mental health and other concerns.

The owner of Instagram and Facebook, Meta, is being sued by many states for allegedly playing a role in the mental health crisis.

Bryn Austin, a professor in the Department of Social and Behavioral Sciences at Harvard and a senior author on the study, said, “Although social media platforms may claim that they can self-regulate their practices to reduce the harms to young people, they have yet to do so, and our study suggests they have overwhelming financial incentives to continue to delay taking meaningful steps to protect children.”

For a long time, experts and parents have expressed concerns about marketing directed at kids online, as social media platforms are not the first to advertise to this age group. Online ads are particularly dangerous due to their ability to target children. The ambiguity between ads and the content sought by kids further heightens the problem.

The American Academy of Pediatrics said in a policy paper written in 2020 that children are “uniquely vulnerable to the persuasive effects of advertising because of immature critical thinking skills and impulse inhibition.” They added, “School-aged children and teenagers may be able to recognize advertising but often are not able to resist it when it is embedded within trusted social networks, encouraged by celebrity influencers, or delivered next to personalized content.”

Earlier this month, the Federal Trade Commission proposed sweeping changes to an outdated law that regulates how online companies can track and advertise to children. The requested modifications consist of limiting notifications as a default and turning off targeted ads to kids under 13.