The Ruling That Could Unravel Social Media | Behind the Numbers

Summary

Podcast Summary

Behind the Numbers: An EMARKETER Podcast

Episode: The Ruling That Could Unravel Social Media
Date: April 6, 2026
Host: Marcus Johnson
Guests: Ethan Kramer-Flood (Principal Forecasting Writer), Emmy Lederman (Analyst)

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Episode Overview

This episode dives into a groundbreaking court ruling where Meta and Google were found negligent in a social media harm trial. The discussion covers the implications of treating social media platforms as defective products, potential shifts in public sentiment and legislation, and what this means for the future of social media business models, regulation, advertising, and youth mental health.

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Key Discussion Points & Insights

1. The Landmark Rulings and Their Implications ([04:45])

• A California jury ruled Meta and Google contributed to a woman's childhood social media addiction, granting $6 million in damages ([04:45]–[05:30]).
• This is the first case finding social media apps legally liable for being engineered to exploit children and teens’ developing brains.
• Similar, even larger, verdicts have recently been made—such as a $400 million penalty for Meta in New Mexico.

Notable Quote:

• “This is the first time a jury has found social media apps should be treated as defective products for being engineered to exploit the developing brains of kids and teens.” – Marcus ([04:45])

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2. Is This a Turning Point? Industry and Legal Reactions ([05:32])

• While damages are minor for trillion-dollar companies, the psychological win for those warning of social media’s mental health impact is significant.
• Emmy sees the case as a “morale boost” for critics and a potential bellwether for a flood of similar lawsuits ([04:19]–[05:32]).
• Ethan notes the huge scale potential: if damages are repeated, this could mean tens of billions in liability ([05:57]–[07:27]).

Notable Quote:

• “If the next person wins and the next person wins … the liability is going to stretch into tens of billions pretty quickly.” – Ethan ([07:06])

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3. Legal Strategy Shift: Platform Design vs. Content ([07:27])

• This case succeeded by attacking harmful product design elements (e.g., infinite scroll, algorithms) rather than user-generated content, bypassing Section 230 protection ([07:45]).
• “YouTube’s argument that they’re not a social media company is now irrelevant. It’s about the product, not the label.” – Ethan ([08:29])

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4. Responses from Tech Companies ([08:49])

• Meta: Claims youth mental health is complex, cannot be pinned to a single app, and will defend its record.
• YouTube: Insists it is a “responsibly built streaming platform, not a social media site.”
• Emmy points out YouTube’s success is precisely because it acts like a social media platform via recommendations, making this defense weak ([08:49]–[09:52]).

Notable Quote:

• “YouTube is highly capable of recommending you new videos to the point where you feel like you cannot escape the YouTube hole that you fell into.” – Emmy ([09:33])

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5. Complexity of Mental Health and Addiction Arguments ([09:52])

• The platforms claim mental health has multiple causes; however, Ethan argues this approach is increasingly ineffective in the judicial system.
• Once in court, public relations arguments lose significance if legal merits repeatedly succeed ([11:00]–[12:38]).

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6. Addiction Framing and Evolving Public Perception ([13:38])

• New studies show behavioral similarities between social media addiction and substance abuse ([12:38]).
• “Now people are moving from denial to acceptance … there’s collective acknowledgment these platforms harm mental health.” – Emmy ([13:55])
• Products like “the Brick” (physical device to limit phone use) echo nicotine gum/patches, underlining a societal shift ([14:38]).

Notable Quote:

• “People are spending real money on a physical product to change their social media habits—it reminds me a lot of nicotine gum or a nicotine patch.” – Emmy ([15:15])

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7. Potential for Broader Legal Liability ([15:31])

• Lawsuits could easily expand from children to the general public—mirroring the tobacco lawsuits that weren’t limited to minors ([15:30]).
• “If you put out a defective product that's hurting all of us, that actually opens up the world of lawsuits to all of us.” – Ethan ([16:03])

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8. Trends in Social Media Usage ([17:11])

• Social media use in the US has plateaued and may be slightly declining.
• On average, Americans spend 1.5 hours/day on social, but engagement share is moving to other platforms like Reddit and away from Snapchat/X ([17:21]).
• Instagram is projected to overtake Facebook in time spent; Reddit now ahead of Snapchat and LinkedIn ([19:55]–[22:20]).

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9. Possible Platform and Policy Changes on the Horizon ([23:29])

• Likely regulatory interventions: Age verification, outright bans for under-14s, and mandatory parental permissions ([23:29]).
• Civil lawsuits could force platforms to redesign core “addictive” features—e.g., banning infinite scroll, algorithmic feeds, or auto-play ([24:19]–[25:13]).
• Emmy notes special concern for the creator economy and the indirect effects on brand partnerships and influencer marketing if exposure to youth is curtailed ([25:36]).

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10. Risks to Section 230 and the Future of Ad Industry ([27:27])

• Growing scrutiny of Section 230 as a legal shield—recent Senate hearings may threaten its stability ([27:27]).
• Marketers may need extra caution when advertising to youth audiences, given new reputational and governance risks ([27:50]).

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11. AI Innovations and the Risk Multiplier ([28:41])

• Rapid platform investments in AI pose an even greater potential risk for harm, especially with tools like chatbots that can reinforce negative behaviors or echo chamber effects for minors ([28:41]).
• The legal precedent of treating “addictive design” as a product flaw may endanger not only social, but generative AI platforms ([29:52]).

Notable Quote:

• “The idea of having a chatbot that will just reaffirm everything you think about the world as a child, and also act as your companion and maybe even replace real-life connections … you can just see how these issues could snowball.” – Emmy ([29:21])

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Key Segment Timestamps

| Segment Topic | Timestamps | |------------------------------------------------------------------|------------------| | Mount Whitney/Death Valley Banter & Transition | 00:00–04:45 | | Case Background & First Impressions | 04:45–07:27 | | Legal Strategies & Section 230 Loopholes Closing | 07:27–09:52 | | Company Statements & Weakening Defenses | 09:52–11:00 | | Addiction Frame, Public Perception, and Physical "Solutions" | 12:38–15:31 | | Expansion of Liability Beyond Kids | 15:31–16:29 | | New Data: Social Media Usage Trends and Winners/Losers | 17:11–22:20 | | Discussion: Redesigns, Age Verification, Infinite Scroll | 23:29–25:36 | | Section 230, Reputation Management, Ad Industry Implications | 27:27–28:41 | | AI Innovations and the Risk of "Addictive" Chatbots | 28:41–30:53 | | Ongoing Legislation, Wrap-Up, Closing Remarks | 30:53–32:31 |

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Most Memorable Moments & Quotes

• “This could be the ‘big tobacco moment’ … the dam is breaking in favor of industry-wide changes.” – Marcus ([05:32])
• “It's not about what politicians think anymore—now it's about what juries think, and the PR battle is ultimately irrelevant.” – Ethan ([11:00])
• “It had to get bad enough to impact kids for people to pay attention.” – Emmy ([16:18])
• “Even if [social media] is not the only cause, it's no longer effective to dismiss its role in mental health struggles.” – Emmy ([10:41])

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Episode Tone

• Analytical and conversational, blending data, industry expertise, and humor
• Earnest concern over youth safety paired with realistic takes on ad industry and tech business resilience
• Emphasis on legal/market realities over PR posturing

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For Marketers and Industry Observers

This episode is essential listening for anyone seeking to understand the legal, reputational, and business risks facing social platforms—and by extension, advertisers and marketers—in the wake of novel legal strategies that target addictive design. The discussion points to a future full of potential regulatory redesigns, changing youth engagement patterns, and implications for AI-driven features.

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Transcript

[A]

Verb's global omnichannel advertising platform redefines what's possible beyond Ward Gardens. VERB illuminates, connects and activates high fidelity signals that drive outcomes for brands, agencies and publishers at scale. Learn [e-mail]. Hey Gang. It's Monday, April 6th. Ethan, Emmy and listeners welcome by the Numbers New Markets podcast made possible by Verve. I'm Marcus and join me for today's conversation. We have two New York based folks. One of them is our principal forecasting writer called Ethan Kramer.

[B]

Flood, Marcus, I'm excited to be here today. We got a saucy one.

[A]

Okay. We're also joined by analyst Emmy Lederman.

[C]

Hello. Thanks for having me.

[A]

Hello, Emmy. I'm glad you're here. Ethan. Not so much. Today's fact. California is home to Mount Whitney, which is the highest point in the contiguous US at 14 and a half thousand feet. And California is also home to Death Valley, which is the lowest point in North America, around 300ft below sea level.

[C]

Wow. They have it all.

[B]

That's the fact.

[A]

That's all I got. Yeah. Well, there was this graphic visual capitalist showing basically like the elevation in the US by state. It was really cool. And what I, I mean I knew the Rockies were high and the rest not so much. But it's so interesting because it, it really is kind of these blocks of elevation. So if you draw a line down the middle of America, kind of Minnesota, down to Louisiana, the whole. Right. Half of the country is like basically half the states is about 100 to a thousand feet above sea level. So not very much like all of it. No, there's no one state which towns. But then you've got this strip down the middle kind of North Dakota to Texas, which is about two to two and a half thousand feet. All those states in a row. Then you've got the cluster of the Rocky states, the kind of Wyoming, Colorado, Utah, a bit of New Mexico as well. They're about five and a half to 7,000. So it's like a big jump. And then the west coast is like 2, 2 to 3,000ft high. I thought it was quite interesting.

[B]

That is, I mean the Death Valley thing is, is, is well known. I did not know the thing about that one big peak in California though.

[A]

Yeah. In the contiguous. Because Alaska, Alaska wins. When you look at the. The highest point ever. Denali national park and Preserve.

[B]

Ah yeah. Also sounds familiar.

[A]

Did that feel worth it? You'll never get that.

[B]

Not even close.

[A]

All right, good. Today's real topic, the ruling that could unravel social media. So a jury finds Meta and Google negligent in social media harms trial, writes Bobby Allen of npr. He explains that in a landmark trial, landmark decision to the California jury, Rawd, Meta and Google contributed to a woman's childhood social media addiction, resulting depression and anxiety, awarding her $6 million in a rare case holding tech companies accountable for youth mental health harm. He rightly points out that whilst the financial punishment is minuscule for companies each worth trillions, the decision is still consequential. Representing the first time a jury has found social media apps should be treated as defective products for being engineered to exploit the developing brains of kids and teens, Meta and Google will both appeal. Meta said teen mental health is, quote, profoundly complex and cannot be linked to a single app. We will continue to defend ourselves vigorously as every case is different and we remain confident in our record of protecting teens online. Close quote. And YouTube said, quote, this case misunderstands YouTube, which is a responsibly built streaming platform, not a social media site. Close quote. The verdict in la. No. Another case came a day after a jury in a separate trial in New Mexico ordered Meta to pay nearly $400 million in damages for failing to protect young users from child creditors on Instagram and Facebook. So that's the background, that's what's going on. Emmy, what's your number one takeaway from the ruling rulings?

[C]

I would say my biggest takeaway is even if the ruling doesn't amount to any major changes in how the platform works immediately, or it takes kind of greater pressure for anything with the algorithm to be disrupted, I do think that this is a bit of a morale boost for people who have been saying for all these years that social media is kind of predatory and detrimental to people's mental health, especially, you know, kids and teens mental health. And I think it also just shifts the conversation away from social media as kind of an individual choice where it's totally up to the user how much time they spend on it and kind of up to their parents to monitor it and shift it towards social platforms. And I think it'll be interesting to see with potential other trials. People are calling this a bellwether case, meaning that this is the could be the first of many how that continues to kind of amp up. So again, I think it is just kind of a win for people who have made this rallying cry for years that social media is detrimental and kind of deliberately detrimental to people's mental health.

[A]

Ethan, I mean, is this. Do you think it's kind of isolated cases and it's something that in a few years kind of will have to, you know, research to remember what happened. Or do you think that this is because it's been talked about as this like big tobacco moment that people have been referencing? Mr. Allen of NPR was putting it, saying, the lawyers involved in this case against tech companies view the LA verdict is a promising early sign that the dam is breaking in favor of industry wide changes.

[B]

Yeah. So you asked, you know, what was your first response? And for me it was definitely my response was, wow, this might be for real. And I had to really sort of take a second look at what these conclusions were and then sort of extrapolate into my head the potential severity of what this means. And you know, we'll talk a little bit later about maybe what the future will end up looking like. But just in the short term, I was like, wait a minute, this is a significant amount of money considering it's just one person, you know, $6 million, three. $3 million in damages and $3 million in punitive. 70% for Meta, 30% for YouTube, whatever. It doesn't really matter that much. The point is that it's one person making like a pretty straightforward argument and that there's like 3,000 more cases already in, underway, basically making exactly the same argument just in California alone. And if one person has won, obviously we don't know how it's going to go, but if the next person wins and the next person wins, the next person WINS and it's $6 million, we can conservatively assume that the total number of people that are going to be bringing these cases has probably already increased 10x or 20x or 50x or 100x just in California alone. So if they lose on the exact same merit, which is basically you are, you have produced a faulty product that is harmful, then you know, the, the liability is going to stretch into the tens of billions pretty quickly.

[A]

Yeah.

[B]

And I was like, I, I don't know what they're going to do. Like if this case is straightforward and other juries agree, they're just going to keep losing. And then, yeah, this is, this is why the stock market responded, you know, pretty, pretty dramatically. And all of a sudden, you know, everyone's shares went down. It's like, oh, this could be real.

[A]

Yeah. And it's a large part because they've taken the prosecution took a different approach than cases in the past because there's a new strategy of going after how social media's services have been designed, which we've seen has been more successful. Than going after the content that people see on the platforms. Because usually social media companies can bat that away with Section 230 of the 1996 Communications Decency act, which basically says, um, we're not. Platforms aren't responsible for the content that people post there. They went after, in this case, the design features of the platforms. And so that's a big reason why they were able to see more success than cases in the past.

[B]

YouTube's argument that they're not a social media company really isn't relevant anymore. You know, that argument is out of the old playbook, like who cares whether you're social media or what? And this is why people are talking about the AI chatbots possibly becoming. Having the same liability. It's just your product. You know, if your product has these faults and causes this damage, it doesn't matter what the label is.

[C]

Yeah, yeah. I think one of the most interesting parts of all of this is the ways that Meta and YouTube reacted very differently. Like Meta, as you mentioned before, Marcus just said teen mental health is profoundly complex and can't be linked to a single app. So they're kind of redirecting the conversation away from them by saying we can't possibly ever talk about teen mental health because it's far too nuanced. Which is kind of a great way to just avoid conversation forever. And then for YouTube, they're just talking about how they're responsibly built streaming platform and not a media site, which I found notable because the reason that YouTube has had so much charm and like been so effective at keeping people on their platform is, is because they're actually not just a streaming platform. They're highly capable of recommending you new videos to the point where you feel like you cannot escape the YouTube hole that you fell into. So it is not, not surprising but notable that they took that route.

[A]

But it is one of the main arguments that they. And the pushback that they had in this case was that mental health is very complex and it's hard to just.

[B]

It.

[A]

It's hard to judge a case or a situation based on one thing that's happened to a person because things are quite complex and I think they may be somewhat. Fairly noted just to be in, you know, in their corner for a second that social media isn't use isn't the whole picture. They're pointing to emotional and physical abuse in this person's plaintiff's medical records indicating she experienced at home and saying that the plaintiff's therapist never documented that social media use was a factor in her mental health problems. So I do think have to be a bit careful to not just say everything that's happened to this person is as a result of this, of this platform.

[C]

Yeah, yeah, no, I totally agree. I think just because it's not totally a direct result of social media doesn't mean that it's an effective counter argument to say like it's far. So mental health is far too complex to associate it with the platform. It's just a bit of a cop out.

[B]

Yeah, I mean, I think these arguments are also losing relevance in as much as that's basically the court of public opinion, the PR battle. Right. They're saying that to us as if it matters what we think. It doesn't matter what we think. And then, but then in the past or the reason for making these arguments and all the things that they say when they're called before Congress is because the fear for a long time has been that sea change in society's opinion and then what that might do for, for political, to the politicians and then the legislation. So the big fear is like, what is Congress going to do? What are state level legislators going to do? And so we need to fight this battle, this PR battle in order to sort of head that off at the pass. But that all goes out the window. It just doesn't matter anymore. This is the judicial system and these are individual lawsuits and individual trial lawyers and the lawyers don't care about your pr. And if they can win the case based on this merits over and over again, they can, they can talk as much as they want. The PR people can talk as much as they want. It's not going to matter at all because now you're down to just the sort of outcome of the judicial system and it's just going to happen over and over and over again no matter, no matter if juries continue to find these points invalid. Yeah, and it seems like that's likely because it seems like this was not that hard of a win as it turns out. And you know, they'll appeal. But I haven't seen, I haven't seen very much analysis that suggested that they're likely, they, you know, they might get the penalty reduced on appeal, but it doesn't seem very likely that they're going to get this overturned unless they come up with some new information. So yeah, this is no longer about what politicians think or what society thinks. It's about, you know, what juries think.

[A]

The other part, which I thought was interesting was the kind of reference and acknowledgement of addiction so we've talked about social media use or overuse, but Omri Ben Shahar, law professor at University of Chicago, saying, what is new is the addiction element. And there was one addiction study, I think it was in that NPR piece I was reading. Dr. J. Jason Nagata, pediatrician at the University of California, San Francisco, who found teens had habits that mirror symptoms of addiction to substances like withdrawal and impaired functioning. Researchers asking 11 and 12 year olds to respond to statements like, I've tried to use my social media app less, but I can't, or I've become stressed or upset when I'm not allowed to use my social media apps. On a scale of 1, never, 6 very often, 16% said they tried but failed to use social media less, and 23% said that they spent a lot of time thinking about their social media apps. So I thought the, the addiction element is another reason that the tide does feel like it's turning on, on social media.

[B]

All you got to do is find 10,000 kids in this country that can make that argument. And, you know, every one of those families is going to win their cases and these companies are going to be on the verge of bankruptcy. Yeah. So this is, this is why I'm like, well, this could be very real and the future could look. Yeah, could look different.

[A]

Please, Emmy.

[C]

And I think also the argument that social media is addictive kind of used to be seen as trivial because, you know, addiction is a very strong word. So people were like, oh, I guess I'm addicted to my phone, but it's not really the end of the world. It could never be comparable to other things that we kind of accept are addictive. But now I think people are kind of moving from that, like, denial to more of an acceptance phase where if you talk to someone who, like, decided to take a break from social media, the response is, oh, wow, that's awesome. Like, good for you. Opposed to, like, kind of. Why would you do that? So I think there is this collective acknowledgement that these platforms can be harmful to people's mental health. One example that I think really highlights this is the popularity of this new product called a brick. I don't know if you guys have seen it on social media or not, but it is like a physical tile that you can buy and put on. The way it works is basically it's like a magnet that you put in your house and then you have to, like, brick your phone and it locks you out of all these platforms. Then when you come back home at the end of the day and use the magnet, you can access them again. And I just think this shift away from using like, an app that may help you manage your social media time to, like, investing in a physical product, it just reminds me a lot of, like, nicotine gum or a nicotine patch or something like. It's just. It does just feel different that people are spending, like, real money on a physical product to change the extent of

[B]

effort to address addiction.

[C]

Yeah.

[B]

It's astounding. And that, and hearing you say that reminded me of something else. If we want to take this even one step further, the tobacco companies didn't just get in trouble for what this was doing to kids. They got in trouble for what it was doing to everyone. They were hiding the fact that their product was bad for everyone. So so far, this social media storyline has focused on lawsuits related to kids because that's probably the path of least resistance to get a legal settlement. Yep. But you could very easily transition this into their products, hurt everyone.

[C]

Yeah.

[B]

And then you were talking about a very big, like, why, why is it only against the rules to put out a defective product that harms mental health of kids? No, you also, if you put out a defective product that's hurting all of us, then that actually opens up the world of lawsuits to all of us. Yeah, yeah.

[C]

It had to get bad news. It had to get bad enough to impact kids for people to pay attention or kids need to kind of be the headline for the conversation to change.

[A]

Yeah. Speaking of headlines, we don't have to look very far, very hard to find headlines that indicate that the tide might be turning slightly on social media use. Armorista Jones was noting that Gen Z's TikTok appetite might be waning. According to a report from the Harris Poll cited by Media Post, finding Gen Z'ers have lost trust in TikTok since its transition to US ownership. 74% think more critically about how they engage with the app. 60% trust TikTok less. The Snapchat as well, according to its financials, had showed signs of softening user growth in 2025. And Ethan, you've just put out some research on. On how much time people are spending with.

[B]

With.

[A]

With social platforms, all the social platforms. How much? When we look at the actual numbers, how much are Americans using social networks and what stands out to you about their usage?

[B]

Yeah, it depends how you look at it. So there's a case to be made on both sides here. So sometimes what you hear is the social media heads, particularly in their trials against antitrust and the government, when they're arguing back against the government. In recent times, they've said, hey, look, we're not even that big of a deal. The amount of time the story has sort of passed, there is lots and lots of other media out there. The total amount of time, how many people and the total amount of time they're spending with social media is actually not that big. And it's plateaued and in some cases it's going down. And all that's kind of true. On the other hand, if you look at the total numbers, they still seem outrageous, right? You got the average American spends more than an hour and a half per day with, with social networks. The active users spend more than two hours a day. These are really, really big numbers. They become less outrageous when you realize that we spend, you know, 13 hours a day with some form of media. So, like that's true. And then the other thing is that's that is correct is that a lot of these numbers have been, have started to go down. So really, Facebook has been losing share of people's attention for a long time now. TikTok, as you mentioned, had been on a slight downward trend over the last couple years. That sort of stabilized. And social media in general is not really growing. Right. We as a society have sort of plateaued in terms of the amount of time it had been going up, up, up, up, up forever. And then recently it sort of stopped going up. And by our forecast at least, users will start to go down even in just like a minute or two or whatever over the next few years. Because indeed some, some things like TikTok are no longer really driving increasing engagement. So you could make the case that, you know, as they say, why are you picking on us when people spend even more time with Netflix or actually YouTube really, which would count as an OTT as they'd be happy to hear people spend a lot of time doing lots and lots of other things besides just social networks. And we as a society have stopped growing. But it's still pretty big, you know.

[A]

Yeah.

[B]

Yeah,

[A]

it is fascinating to see that. I mean, next kind of. We have hit a bit of a tipping point, especially in Quadra forecasts. Like Ethan said, next year, minutes will basically, they're flat. No, people won't be spending. Americans won't be spending more time on social media this year than they will next year. If anything, over the next few years past that is going to be going down a bit. Particularly, particularly when you look at the share of that digital time and how much goes to social media versus things like streaming that either mentioned what stands out to you, Emmy, about the social media use of Americans.

[C]

So I think the increase in popularity of Reddit is really interesting. I think for a while Reddit was kind of considered this like fringe platform that had sort of like odd, not socially acceptable conversations happening on it. And I think now it's shifted to be a destination where people go if they want, like relate to, relate to people on a conversation or build community or simply just like get an answer to their questions. Whether or not that is a vetted correct answer or not is a different story. But I think it speaks to the fact that even though the advertising kind of arm of Reddit is increasing, there is some fatigue on TikTok just because of the sheer amount of like ads and products that are being pushed to people all the time and this over consumption. And I think people just miss social media as a, as true like social destinations and having, being able to communicate with peers. And I think like, because platforms like TikTok have really deprioritize that, it makes a lot of sense to me that Reddit is coming out on top.

[A]

Yeah, I mean, for context, Ethan, it's not just that Reddit has seen a lot of growth recently, it's that people are spending more time on Reddit than LinkedIn, Pinterest, Snapchat, like a lot of these platforms which people may assume get more attention.

[B]

Yeah, it's more fun for me to talk about all the negative side, the negative side of the story and all the ones that are going down because Snapchat losing users and losing time spent X has been shedding users and shedding time spent ever since it's changed over from Twitter. But there are, there's a flip side. So Reddit is just going like gangbusters. Instagram is also still very much on an upward trajectory and that's obviously one of the big boys. So they continue to gain users and gain time every year and in fact will probably overtake Facebook. So it'll be the first time in history something other than Facebook will be the leading. I mean, yeah, if you're meta, you don't care, right? If meta, it's like, all right, well we're still one and two, you know, whatever. TikTok is not actually going to end up catching them. But yeah, to Reddit's credit, they have in very short order pulled ahead of a lot of their much older competitors and they're going to account for about 10% of social time I think by next year.

[A]

So we've, we said we've already seen time spent on social plateau. For some it's going. For most, it's going down. For some very few, it's going up a little bit. And so we won't be able to link these social media addiction trials directly to, oh, okay, you know, this event happened and that's why social media plateaued. It already did. Maybe we'll see it have some kind of impact later down the line, especially as the kids who might be kind of protected from social media today, what does their behavior look like in a couple of years as they become adults, as they become users of social media in the future? And one of the things that's going to dictate that are the changes that are going to be implemented by the different by the respective interests. One of them is New Mexico Attorney General Rahul Torres, who said they'll ask the court to make matter change its apps to make them safer. So, Ethan, I come to you first for this one. What changes do you expect to see as a result of the social media addiction trial verdict?

[B]

Yeah, there's the safety element and then there's the addiction element. So the safety stuff is probably a little bit more straightforward. That's probably something that politicians will get involved with. That's when you're looking at, you know, this proliferation of age verification or maybe just outright bans. Okay. You know, other countries are doing this. No one under the age of 14 can just be on at all. Or, you know, and then after that you have some sort of parental permission. And then, and then in order to implement this, you force these companies to verify the age of their users and then you extract penalties if they fail to do so. This is something that probably all of society is rapidly getting behind and individual states or even can do it on their own, and they're going to probably start to do it on their own. That's different than the addiction thing, though. The faulty product thing and the causing harm. That is, that's a big one.

[A]

Right.

[B]

And that, that's when we get, we get into some very serious notions of really threatening the business model. Because if these social networks have to abandon everyone under the age of 13, they're still going to keep going, right? They're still going to be fine. They'll be upset about it, but they'll still be some of the most powerful tech companies in history. But if they are forced to change the fundamental design of their apps to get rid of these addictive elements, in other words, get rid of Infinite scroll for instance, not that the government will force them to get rid of Infinite scroll, but that basically that lawyers will force them to get rid of it because they're going to lose so much money again and again and again and again and again that they're going to be facing bankruptcy unless they voluntarily choose to change their own product. This is an extreme outcome. I have no idea if it's going to happen. But it's not unreasonable for all of us to start thinking about a future where social media apps do not have Infinite Scroll. And then we start to think about what does that do to the advertising industry.

[A]

Yeah, yeah, Infinite scroll notifications, the auto playing videos, algorithmic content recommendations, beauty filters was something they were talking about. Even health warnings on screens. A lot of these things could change people's behavior. And what does that do to Ethan's point to the business model? Emmy, what about you? What kind of changes are you looking. Not looking for, but maybe expecting in the future?

[C]

Yeah. So I think with Infinite scroll, my mind also goes to how popular livestream is and whether that's going to be disrupted. Not that livestream is kind of a central use case of social media. It's still a little bit of a niche use. But if you think about the creators that go live on a platform like TikTok, they're going live on for like hours and hours on end and kind of building these like parasocial relationships with people and complete. They're completely able to monetize just from their audience and sometimes not even ads or brand deals. So I think that is sort of like tangential to the conversation about Infinite scroll because it can just be such a time suck. And the other thing I'm thinking about is just the impact on the creator economy because even the brands that work with creators that seem to be safe and not aligned with what children are interested in are suddenly lately have had to reconsider that. I mean, if you think about the whole Sephora kids movement, I guess you could say of young girls seeing serums and all this like advanced skin care, all these advanced skin care products that are definitely not catered to them finding these products and like asking their parents to go to Sephora to get them and all that stuff. Like, I think that just goes to show that creators have a much bigger impact on young people, especially young girls, and that is a significant part of their audience. So it does just have me wondering from the safety perspective, if social media does change and there's a lot more precautions among young users, what would that do for creators and brand deals?

[B]

Yeah, yeah.

[A]

There are so many things to consider kind of fallout from, from all of this. One of them I thought was the kind of skepticism over the protection of Section 230, which these companies have really leaned on heavily to keep going and deflect a lot of the, the criticism that they've got what's going on their platforms and the pressure or the concern over the communications, you see act might be, might be growing. Senate Commerce Committee recently held a hearing to discuss that very piece of legislation. So it'd be very interesting to see if that changes at all. The other thing I thought was of note was Marissa Jones, who's one of our analysts. She was writing implications for marketers. One of the points she made was the decision she said doesn't mean meta or YouTube are less viable ad channels given their scale. But it does raise questions of how marketers will approach youth centric media plans in the future. The risk of being associated with platforms causing measurable harm to miners presents reputational and governance concerns. Marketers will likely have to exercise increased caution with that content they promote. Sorry, what content they promote to platforms with large youth audiences.

[C]

One other angle that could come from this trial and whatever legislation is to follow is this perhaps like a shift in how much social platforms are trying to innovate when it comes to AI. That has definitely been a focus with Meta. We see that they're trying out a bunch of different AI tools and smart glasses, so both like inside and outside of the platform. But whatever damage social media is already causing to kids with the introduction of AI, you can only imagine how much more severe that could possibly get. So great point, I think sound like

[B]

they're heading in the right direction.

[C]

Right, right. Like the idea of having a chatbot that will basically just reaffirm everything that you think about the world as a child and also act as your companion and maybe even replace like, replace like real life connection. You can just see how the issues that we already have are only going to snowball or could potentially snowball with like more AI centric platforms. So I wonder if this ruling is going to shift that priority a bit.

[B]

Yeah, I mean, and also like the liability precedent is a major threat to existing chat bots, just ChatGPT and Gemini and all the rest, in as much as we've already seen in the news, incredibly, terribly, you know, horrifying outcomes for kids and adults related to these chatbots. However, the AI companies will have the defense of we are fixing it, you know, we are changing it. We're doing something to make this problem not be here anymore. Whereas for the social media companies, it's the fundamental nature of their product.

[C]

Right.

[B]

They're not doing anything to get rid of the addictive elements, because the addictive elements are why they're a successful business business. So it is different. And YouTube is also the third angle. Like, YouTube probably has a whole bunch of different ways to sort of work around this and change how their system works. You know, I could see a backdoor for YouTube, but I don't see a backdoor for Facebook and Instagram. TikTok. I mean, I think there's big trouble coming.

[A]

Yeah. A lot of this legislation is already kind of half on the books. Dr. Nagata, pointing to regulations proposed in the Kids Online Safety act that passed the Senate in 2024, has been stuck in the House ever since. That includes things, he says, like design changes for restricting infinite scroll, personalized feeds, notifications for miners and things like that. But we'll see. That's all we got time for for today's episode. Thank you so much to my guests. Thank you. First to Ethan.

[B]

Thank you, Marcus. This is a good one. See, I promise. Sauce. And we brought the sauce.

[C]

We did well.

[A]

Two of us. Thank you, Damie.

[C]

Thank you for having me. Me. This was great.

[A]

Yes, indeed. Thank you so much to the production crew as well. Who do we have? We got John and Luigi hanging out in the background. Thank you guys so much for helping out today and thank you to everyone for listening in sp the Wisney Month podcast made possible by Verve. Subscribe and follow Leave a racing review if you can. They really, really do help. Susie will be here on Wednesday talking about whether or not the world still needs department stores. And I hope to see you on Friday. It. Oh, now I've got the siren. Maybe it's just in my head.

[C]

I hope not.

[A]

I think it's gone. But just so. It was one of the arguments they were making, right, that, you know, mental health is. Is a very complex issue, but to. To, you know. Oh, my God, it's back.

[B]

Sorry. I think it's you. I don't hear anything.

[C]

I'm. I'm nervous for you, Marcus.

[A]

Need to lie down.

[B]

All right. All right, cool.