A social media company facing an under-16 ban should cost out a safe tier, a teen version without the algorithmic feed.
An algorithmic feed is the stream of posts that the platform's software picks for each user. A safe tier drops that feed. Teens on it can still interact with their friends. The company pays to build and run the safe tier.
Australia's social media age limit took effect on December 10, 2025. It requires the platforms it covers to prevent users under 16 from holding accounts. On January 16, 2026, the Australian government said that more than 4.7 million under-16 accounts had been deactivated, removed or restricted. The government said this happened "within days" of the law coming into effect.
The eSafety Commissioner, Australia's online safety regulator, published a compliance update in March 2026. Mediaweek reported that the update counts the 4.7 million as accounts rather than individual users. The update also drew on a survey of 898 parents and carers of children aged eight to 15. The survey ran from January 19 to February 2, 2026.
In that survey, 49.7 percent of the parents said their child had an account on at least one platform before the law took effect. For the period after it took effect, 31.3 percent said so. Parents most often said a child kept an account because the platform had not yet asked the child to verify their age.
A working paper from the National Bureau of Economic Research, dated October 2026, notes early evidence of "limited adherence" to teen bans. The paper says a ban asks platforms to give up "profitable customers". It also asks teens to give up access to their online friends.
The authors study a different rule. Under it, platforms still face penalties for teens found on the full version of the service, which the paper calls the adult version. Platforms may also offer a safe tier that drops the parts the rule restricts, such as algorithmic feeds. Teens can then follow the rule without losing access to their friends. Platforms can keep those teens as "lower-margin customers", meaning each one brings the platform less profit.
The authors find that this design makes friends matter less when a teen decides to stay off the adult version. They also find that it leaves teens better off at some levels of the penalty a regulator sets.
Earlier work by some of the same authors shows how much friends matter. That study, published in the American Economic Review in 2025, ran paid experiments with more than 1,000 US college students in 2023. Among active TikTok users, 60 percent would have been better off if TikTok did not exist. For active Instagram users, the share was 46 percent. Fear of missing out was the most common reason active users gave for still using each platform.
What to do first:
- Chief product officer: within a month, list what the safe tier drops besides the algorithmic feed, and which ways of reaching friends it keeps.
- Chief financial officer: in the same month, compare what the feed earns from each teen user with the cost of building the safe tier.
- General counsel: before any launch, ask each regulator in writing whether the safe tier meets its age rule.
The German Research Foundation funded the National Bureau of Economic Research working paper. One of its authors founded and runs NOMO Technologies, which makes digital wellness tools, and owns a stake in it. The paper says the company had no role in the research.
