Why TikTok has agreed to pay $100M to Alabama
What's the story
TikTok has settled a lawsuit with the state of Alabama, agreeing to pay at least $100 million and impose restrictions on teenage users. The settlement, which avoids a trial scheduled for Monday, is similar to Meta's recent agreement with US states. Alabama Attorney General Steve Marshall hailed the settlement as "a great day for Alabama parents," adding that "tonight, they can rest easier knowing real protections are in place to shield their children from the dangers of social media addiction."
Safety measures
Settlement includes safety measures for teens
The settlement also includes a number of safety measures for teenage users.
These include a daily time limit of two hours, restricted access from midnight to 6:00am and disabling notifications during school hours.
The company will also strengthen age verification processes, prohibit beauty filters for teens, and provide a non-personalized content feed.
Potential payout
TikTok's payout could reach $300M
Under the settlement, TikTok will pay $100 million to Alabama and could pay up to $300 million if 40 other attorneys general sign similar agreements within a certain period.
The lawsuit was part of a larger wave of litigation against social media companies over alleged harm their apps cause young users.
In August, Meta agreed to pay $18 billion to settle a similar lawsuit accusing it of designing Instagram and Facebook to get children addicted.
Company statement
TikTok has faced lawsuits from other states
In response to the settlement, a TikTok spokesperson said, "TikTok's priority has always been fostering a safe and positive space where people can be creative, discover what they love, and connect with their community."
The company has also faced lawsuits from over a dozen other states, including California and New York.
Despite these challenges, TikTok has previously settled cases that were headed for trial.