Home » Harvard Study Finds Young Americans Are Source of $11 Billion in Revenue for Social Media Companies

Harvard Study Finds Young Americans Are Source of $11 Billion in Revenue for Social Media Companies

by Richard A Reagan

A recent Harvard T.H. Chan School of Public Health study has uncovered a staggering $11 billion revenue generated by social media companies from advertising to minors in the U.S. last year, raising significant concerns about the need for stricter government regulation.

The research, published Wednesday, highlights the substantial profits garnered from young users, prompting calls for greater transparency and control over these platforms to protect youth mental health.

The study’s senior author, Bryn Austin, a professor in the Department of Social and Behavioral Sciences at Harvard, stressed the urgency of the matter. “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,” Austin stated. [Source]

To calculate the revenue figure, the study team estimated the number of users under 18 on platforms like Facebook, Instagram, Snapchat, TikTok, X (formerly Twitter), and YouTube. This estimation was based on U.S. Census data, survey information from Common Sense Media and Pew Research, and ad revenue data from Insider Intelligence and Qustodio. A simulation model was then developed using this data to determine the revenue generated from minors.

The findings come amid increasing scrutiny of social media’s impact on youth mental health, with lawmakers in states like New York and Utah considering legislation to curb social media use among children. This concern is further bolstered by lawsuits against Meta, the parent company of Instagram and Facebook, for allegedly contributing to the mental health crisis.

The study sheds light on the murky realm of online advertising to children. “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,” noted a 2020 policy paper by the American Academy of Pediatrics. 

In response to growing apprehensions, the Federal Trade Commission has proposed amendments to a decades-old law governing online tracking and advertising to children. These changes include disabling targeted ads to kids under 13 by default and limiting push notifications.

The study provides a breakdown of revenue from different age groups: YouTube earned the most from users aged 12 and under ($959.1 million), followed by Instagram ($801.1 million) and Facebook ($137.2 million). For the 13-17 age group, Instagram led with $4 billion, followed by TikTok ($2 billion) and YouTube ($1.2 billion). [Source]

While platforms like Snapchat, TikTok, and YouTube derived a significant portion of their ad revenue from users under 18, Facebook and X (formerly Twitter) accounted for only about 2% of their annual ad revenue from minors.

Google, parent company of YouTube, has not commented on the study but highlighted its policies for young users’ safety and mental health. Snapchat, X, TikTok, and Meta have yet to respond to inquiries regarding the study.

The study concludes by highlighting the need for “greater data transparency as well as public health interventions and government regulations,” as stated by Amanda Raffoul, an instructor in pediatrics at Harvard Medical School and co-author of the study.

As social media’s influence on the younger generation becomes increasingly evident, this study confirms the necessity for immediate action to safeguard the well-being of America’s youth.

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