Meta will pay up to $17 billion and cap teen time on Instagram and Facebook

Meta Platforms agreed on Wednesday to a proposed settlement of up to $17 billion with a coalition of U.S. attorneys general over how Facebook and Instagram treat children and teenagers. The deal, which still needs a federal judge’s consent judgment, would also force product changes: a default two-hour daily cap across both apps for users under 18, mandatory pauses after 15, 60 and 90 minutes of continuous use, and a night block from midnight to 6 a.m. unless a parent lifts it.

Trial had opened on 18 August in the U.S. District Court for the Northern District of California. The settlement was announced before Instagram head Adam Mosseri was due back on the stand. Washington Attorney General Nick Brown called it the largest state consumer-protection settlement outside the 1990s tobacco cases. California Attorney General Rob Bonta said California would receive $1.5 billion to $2.1 billion if the court approves the judgment.

The money is staged. Roughly $12.7 billion is guaranteed over ten years in annual instalments. The rest is contingent on Snap, TikTok and YouTube adopting comparable limits. If those firms sign on, the daily cap on each Meta app would drop to 60 minutes and run for ten years. If they do not, Meta’s extra payment shrinks by about $5 billion. Washington state is guaranteed $237 million and could reach nearly $339 million under the same condition.

What changes on the apps

Default settings would stop notifications to minors between 10 p.m. and 7 a.m., and during school hours from mid-August to mid-June. Age-assurance tools are supposed to flag users under 18 and children under 13. Plastic-surgery filters for minors would be banned. An independent auditor would watch compliance. The two-hour cap lasts five years unless rivals match, in which case the tighter one-hour rule lasts a decade.

The states alleged that Meta designed features that drive compulsive use, collected data on preteens without proper parental consent, and misled the public about risk. The claims cite the Children’s Online Privacy Protection Act and state unfair-competition and false-advertising statutes. Meta said it wanted an industry standard and urged YouTube and TikTok to follow.

Texas was not in the main case. Attorney General Ken Paxton announced a separate $1 billion settlement the same day. Florida Attorney General James Uthmeier rejected the multi-state terms. He wrote that the payouts were small next to the alleged harm and that Florida would continue to trial. New Mexico also stayed out of the listed coalition in some state readouts.

The rivals clause is the real lever

Most coverage treated the dollar figure as the story. The structure is more useful. Meta locked a two-hour default that it can live with. It then offered a deeper cut, and a larger cheque, only if Snap, ByteDance and Google accept the same clock. That turns three competitors into the people who decide whether American teenagers get one hour or two, and whether states collect the last $4 billion to $5 billion.

El País called the pact a “tobacco moment” for platforms. The comparison is loose. Tobacco settlements did not depend on Philip Morris rivals signing identical pack warnings. This one does. Parents who want a one-hour rule need TikTok and YouTube to move. States that want the full pot need the same thing. Meta, having settled mid-trial, can argue it set the floor and wait.

Court approval is not automatic. Product engineering has a months-long clock in the attorneys general’s telling. The first test is whether the judge enters the consent judgment. The second is whether any large rival copies the terms before the contingent money lapses.