Meta & Children's Online SafetyEmail: Re: Youth Ads EU Update
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Case 4:22-md-03047-YGR Document 2889-59 Filed 03/27/26 Page 1 of 5 AMENDED Exhibit 290 PLAINTIFFS' OMNIBUS OPPOSITION TO DEFENDANTS' MOTIONS FOR SUMMARY JUDGMENT Case No.: 4:22-md-03047-YGR MDL No. 3047 In Re: Social Media Adolescent Addiction/Personal Injury Products Liability Litigation Message From: Case 4:22-md-03047-YGR Document 2889-59 Filed 03/27/26 Page 2 of 5 [/O=EXCHANGELABS/OU=EXCHANGE ADMINISTRATIVE GROUP (FYDIBOHF23SPDLT)/CN=RECIPIENTS/CN=23B4D13BEBFF4C0A8F76147B5DF6B596- 8/1/2023 1:57:50 AM Lars Backstrom Sent: To: CC: Tom Alison ]; Subject: Re: A/C Priv: Youth Ads EU Update ]; Lars - Yes, there are 4 age-related risks identified. Basically, (1) new true >18 creates unlinked <18 acct, (2) existing >18 creates new <18 account, (3) >18 reduces age, (4) existing >18 links w/ <18 acct. For (1-2), where the user is creating new unlinked Youth accounts, the plan is to trigger Identity Verification (IDV) and is asked to provide ID. There's human verification of ID/name/photo match and this is triggered a few days after new account sign-up to reduce friction for users predicted to be >18 (new or existing). Flow screenshots here. For the change scenarios (3-4), like reducing age, we'd trigger IDV immediately upon account change. The IG Age team is planning to implement this on FB/IG. It's about 15-20 eng weeks. We are asking for funding as part of this decision to accelerate this work if we exit / pause for H2. From: Lars Backstrom Sent: Monday, July 31, 2023 4:51 PM To: >; Tom Alison Cc: Subject: RE: A/C Priv: Youth Ads EU Update In the exit scenarios, how would we know that people were youth? What prevents me from changing my stated age to get an ad-free experience? From: Sent: Monday, July 31, 2023 9:56 AM To: Tom Alison Cc: Subject: Re: A/C Priv: Youth Ads EU Update Tom - On IG, the primary concern appears to be around positioning IG's strategy for Youth and how an exit may impact that message. It is less about the immediate revenue impact for exiting in EU. IG is interested in seeing how competitors react, minimizing engagement impact and giving teams more time to figure out if there's another path. CONFIDENTIAL META3047MDL-278-00041446 Case 4:22-md-03047-YGR Document 2889-59 Filed 03/27/26 Page 3 of 5 There's some risk in a permanent exit if competitors take an aggressive approach to maintain position in the market and a public exit does not force their hand. Further, if we exit and this expands globally and/or expands to predicted age as well (where it's estimated IG has more risk) then revenue impact would be large. Monetization sized global exit on stated age at 0.2% Meta iREV loss, a stated+predicted age global exit for Youth would be > 1% iREV. Mitigating the risk of the global & predicted age expansion will likely influence this decision. I don't think we have to take the same position as IG; we can represent our POV independently, but ultimately the final decision will need to be consistent across apps. The Monetization Leads review is scheduled for tomorrow at 2pm PT to try and land on a decision. From: Tom Alison Sent: Friday, July 28, 2023 6:44 PM To: Cc: Subject: Re: A/C Priv: Youth Ads EU Update Is IG leaning toward temporary impact because the revenue impact is higher on IG? Do we have to take the same position as IG? I'm in the exit camp but wondering if we should just do permanent. 100000000000 From: Sent: Friday, July 28, 2023 5:25:01 PM To: Tom Alison Cc: Subject: A/C Priv: Youth Ads EU Update Tom - We wanted to update you on a decision with Monetization leads next week on Youth Ads in EU (people under 18), driven by recent regulatory developments related to 1PD in EU (GDPR, Digital Markets Act and ePD). Teams have been iterating on options and trade-offs across Monetization, IG and FB. Currently, considering 4 main options for Youth Ads in EU: 1. Build a compliant non-personalized ads (NPA) product 2. Develop an age-banded consent (for 16-17 only) solution for teens (exit for under 16) 3. Permanently exit the EU Youth Ads market 4. Temporarily exit the EU Youth Ads market Ultimately, we feel the decision centers on three major dynamics: 1) competitive landscape, 2) the consumer impact vs. revenue tradeoff and 3) the risks to Meta's overall Youth Strategy and to Ads Free Subscriptions. CONFIDENTIAL META3047MDL-278-00041447 Case 4:22-md-03047-YGR Document 2889-59 Filed 03/27/26 Page 4 of 5 Context on Meta's overall youth strategy: Broader narrative is that we can produce valuable products that are safe and valuable for youth. Approach to ads will need to ensure we can thread the needle with overall narrative. Context on Ads Free Subscriptions (AFS): Launching Basic Ads in EU would lead to significant revenue loss at topline Meta level. As such, we are accelerating the launch of AFS, which would replace Basic Ads (e.g., either pay for seeing no ads or continue to opt into personalized ads). Our current POV - This is evolving, and more is coming in the next few days, but both apps are trending towards an exit recommendation. FB: Leaning towards exit or temporary exit as best option (Option 3 or 4). Non-personalized ads is not a tenable user experience and undermines AFS, given adoption for AFS is predicated on the fact that we are not able to offer non-personalized ads but if we do this for Youth, there may also be a push for us to do this for adults. An age-banded solution incurs similar risks with added complexity. An exit positions us well for a public message, anticipating continued regulatory tightening that will likely expand beyond the EU. IG: IG is leaning towards recommending Option 4, a quiet temporary exit. They're interested in how competitors react and this may give us time to evaluate additional options. However, there is a risk that in our changing regulatory environment, the cost of re-entry may increase and/or may not be possible. Between permanent vs. temporary exit, permanent allows you to take a public stance that we are leaning toward to protect youth, and potentially force competitors to follow suit. Temporary exit preserves option value to bring back ads for Youth, perhaps with consent, depending on regulatory and competitive dynamics but may not allow us to be vocal on a commitment. More color on the major dynamics: Dynamics Competitive Consumer Impact Revenue impact (iREV) Youth Strategy Impact Considerations It's expected that Google will make an attempt to use Family-Link, a parental consent option and TT may choose to adopt consent at ages driven by various regulations. The largest impact across options is around the impact to consumer experience, where exiting ads would retain the most youth visitation and a non-personalized ads solution would produce the worst experience. The iREV impact for EU options across all of the options is relatively similar. The best being, age-banded consent, currently estimated at -0.03% (including predicted age: -0.04%) vs. the worst: a full EU exit, estimated at -0.05% (incl. predicted age: -0.07%). Exiting impacts our ability to showcase we can build safe & valuable products for Youth, depending on how we position what the exit means. Let us know your perspective. We expect a Monetization Leads meeting to decide direction next week, where we will surface recommendations from each app. Best, CONFIDENTIAL META3047MDL-278-00041448 Case 4:22-md-03047-YGR Document 2889-59 Filed 03/27/26 Page 5 of 5 GDPR - No 1PD use for ads delivery, in effect as early as Q3 '23. Digital Markets Act - No use of 1PD from apps (FB, IG, etc) for ads (delivery, measurement, etc), as early as Q1 '24 ePD-1PD Ads - No 1PD use for ads (delivery, measurement, etc), as early as Q3 '23 CONFIDENTIAL META3047MDL-278-00041449