Meta agrees to new protections for teenagers in US in 18bn dollar settlement

With Meta, owner of Facebook and Instagram, introducing major new protections for teenage users and agreeing to pay up to 18 billion US dollars (£13.3 billion) as part of a settlement ending a legal battle in the US, Dan Coatsworth, head of markets at AJ Bell, believes the payout is “a price worth paying”.

He said: “It may be an eyewatering sum for most businesses but in the context of the $145 billion it has allocated to AI-related spending in 2026, the maximum of $18 billion Meta has agreed to settle a children’s social media harm case may well feel a price worth paying. Had it opted to fight the case, there was a risk Meta could have faced a bill running into hundreds of billions of dollars if it lost the action brought by two dozen US states in a California court.

“For investors, it removes a cloud hanging over the business. That explains why what might seem like a major setback at face value has prompted a modest increase in the share price.

“However, there may be some impact on Meta’s ability to monetise its platforms resulting from the restrictions on teenage users’ access to its apps and the extra tools provided to parents and guardians agreed as part of the settlement.

“Litigation over these issues is becoming an occupational hazard for the owners of social media platforms, with regulatory changes also seeking to clamp down on the perceived harms they cause. This is very unlikely to be the last word in the legal backlash against the industry.”