Meta Platforms Inc. has agreed to a settlement with 47 U.S. states, the District of Columbia, and several territories aimed at curbing children’s use of its social media platforms, Facebook and Instagram. The agreement, reached earlier this week, includes provisions to limit minors’ access to the platforms and requires Meta to pay at least $12 billion over a 10-year period, with New York state set to receive up to $1.1 billion from the settlement.

While the financial penalty is significant, it represents a relatively small portion of Meta’s overall revenue, which has continued to grow despite setbacks like losses in its metaverse initiatives. Some states, including California, Colorado, Kentucky, and New Jersey, had pursued damages totaling approximately $200 billion in litigation. Nevertheless, Meta chose to settle rather than engage in a potentially protracted court battle, signaling a shift in its approach following increasing scrutiny of its business practices.

The landmark settlement primarily focuses on new rules designed to reduce the addictive nature of Meta’s social media products for young users. Among the measures, Meta will impose daily screen time limits of two hours on users under 18, restrict usage between midnight and 6 a.m., mute notifications during school hours, and remove visible “like” counts. The company will also curtail the use of image filters linked to body image concerns among teenagers.

Experts note that these reforms mark a departure from longstanding arguments by technology companies that their product design is driven solely by consumer preferences and that regulatory intervention would stifle innovation. By agreeing to these changes, Meta appears to acknowledge the need for greater responsibility in managing youth engagement on its platforms.

The settlement also incorporates an unusual provision tying part of the financial payout and policy reforms to similar agreements by other major social media firms, including Snapchat, YouTube (owned by Alphabet Inc.), and TikTok. If these companies follow suit, industry-wide changes could reduce teen daily screen time limits further to just 60 minutes. This collective approach is seen as a way to prevent Meta from being disadvantaged if competitors maintain more permissive practices.

Although the settlement is being viewed as a positive development, some advocates caution that it is only an initial step in addressing the broader challenges posed by social media’s impact on children. State attorneys general will be tasked with monitoring Meta’s compliance and pursuing comparable settlements with other platforms. At the same time, calls have increased for congressional action to establish comprehensive oversight of social media companies, as lawmakers have been criticized for falling behind in regulating the industry’s expansive influence on society.