TikTok CEO Shou Chew testified before Congress recently, sharing details of the social media company’s handling of data and security.
Chew suggested that TikTok is handled the same way in the U.S. as its rivals, specifically platforms owned by Meta Platforms Inc META, Alphabet Inc GOOGGOOGL and Snap Inc SNAP.
In addition to the growing scrutiny on how it handles data, there is another concern about the amount of time young users are spending on social media and video platforms like TikTok.
See Also: TikTok Founder Meets Walmart Chief Privately, Fuels Speculation Of Deal To Avoid Ban
Utah Governor Spencer Cox signed a law in March called the Social Media Regulation Act that would require parental consent for anyone under the age of 18 to use social media apps. The law would also put in place a 10:30 p.m. curfew for minors and give parents access to the accounts of their children.
“We’re no longer willing to let social media companies continue to harm the mental health of our youth,” Cox said on Twitter.
Arkansas Governor Sarah Huckabee Sanders also signed a bill that will require minors to have parental permission to create an account on a social media app.
“While social media can be a great tool and a wonderful resource, it can have a massive negative impact on our kids,” Sanders said.
The new law for Arkansas will take effect in September 2023, placing it ahead of the March 2024 timeline of Utah.
Arkansas had previously filed lawsuits against TikTok and Meta Platforms over claims the companies misled consumers about the safety of children and protection of data within the social media platforms.
Under the new Arkansas law, social media companies would receive a fine of $2,500 for each violation of the age verification requirement.
The law applies to social media platforms that make more than $100 million in annual revenue and wouldn’t apply to certain platforms including LinkedIn, Google and YouTube.
Along with Utah and Arkansas, other states like Connecticut and Ohio have also been listed as those working on similar legislation for parental permission to sue social media apps.
Related Link: Should TikTok Be Banned In The US? 69% Of Benzinga Followers Say This
Why It’s Important: Many states have banned the use of TikTok on federal and state employees’ phones. States have not begun tackling the banning and usage of apps based on age demographics.
The laws from Utah and Arkansas could be the first of many states to place bans on social media apps or require parental consent for such apps.
States are also targeting the way that the social media platforms collect data and the targeted ads they show minors, which could impact advertising revenue for social media companies.
Benzinga recently reported that Meta Platforms is facing criticism over the decision to allow minors into the metaverse with its virtual reality platform Horizon Worlds.
TikTok has placed time limits on the usage of its app in some cases, but states don’t see this as being enough.
Investors in social media app stocks should be aware of the risks that could be coming.
Next: If TikTok Is Banned, Readers Overwhelmingly Say They'll Flock To One Specific App
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