Investors With $2B In Stock Want Apple To Protect Children From iPhone Addiction

Written by Dana Sanchez

Two of Apple’s biggest investors who together control $2 billion of its stock want the iPhone maker to act on concerns about smartphone addiction among children and the effects of technology and social media on youth, including higher risks depression and suicide.

Apple must do more to help children fight addiction on its devices, the California State Teachers’ Retirement System and New York-based Jana Partners said Monday in an open letter to Apple.

Jana is an activist hedge fund and investment manager specializing in event-driven investing. The California State Teachers’ Retirement System is one of the largest public pension funds in the U.S.

The letter says American teenagers got their first smartphones at age 10 on average and spend more than 4.5 hours a day on them—excluding texting and talking. Nearly 80 percent of teens check their phones hourly, and more than half report feeling addicted to their devices. The investors concede that parents have an important role to play in managing their kids’ screen time, but argue that Apple does too, Quartz reported.

Apple could benefit its shareholders in the future by acting on these concerns, the investors said.

Former Facebook executive Chamath Palihapitiya is one of a growing number of experts who are speaking out about the harm the social network is doing to civil society around the world. He joined Facebook in 2007 and became its vice president for user growth. He said he feels “tremendous guilt” about the company he helped make.

“I think we have created tools that are ripping apart the social fabric of how society works,” he told an audience at Stanford Graduate School of Business, before recommending people to take a “hard break” from social media.

iPhone addiction
Chamath Palihapitiya, Image: Business Insider

Apple is unprepared for this challenge by investors, though it shouldn’t be, Fortune reported.

That smartphones have altered our society—often in a bad way—has been brain-dead obvious for years. In an interview last year to celebrate Apple for (the) positive contribution it has made to the world, (Fortune) challenged Tim Cook to say what Apple was doing about the ‘bad social behavior’ iPhones and iPads provoked, including ‘children who stare for too long into a screen.’ Cook changed the subject, talking instead about Apple’s anti-distracted driving initiative and how the Apple Watch has a feature that reminds you to breathe.”

The investors want Apple to provide tools to help children avoid addiction and give parents more monitoring options to protect children. Apple offers some parental controls, but they’re limited, The Guardian reported. These include restrictions on apps, features such as location sharing and access to certain content.

“There is a developing consensus around the world including Silicon Valley that the potential long-term consequences of new technologies need to be factored in at the outset, and no company can outsource that responsibility,” the investors said. “Apple can play a defining role in signaling to the industry that paying special attention to the health and development of the next generation is both good business and the right thing to do.”

Apple should allow parents to set the age of the user of the phone on setup, and limit screen time, hours of the day the phone can be used and block social media services, the investors said. They also want Apple to create a committee of experts including child development specialists and make Apple’s data available to researchers on the issue.

The letter cited studies and surveys showing that excessive use of smartphones and social media negatively affect children’s mental and physical health, USA Today reported. Examples include distractions in the classroom, a lowered ability to focus on schoolwork, and higher risks of suicide and depression. The reseach includes:

  •  A study by the Center on Media and Child Health and the University of Alberta that found that 67 percent of the over 2,300 teachers surveyed observed that the number of students who are negatively distracted by digital technologies in the classroom is growing and 75 percent say students’ ability to focus on educational tasks has decreased.
  • Research showing eighth graders who are heavy users of social media have a 27 percent higher risk of depression, while those who exceed the average time spent playing sports, hanging out with friends, or doing homework have a much lower risk.
  • A study by UCLA researchers that showed that after five days at a device-free outdoor camp, children performed far better on tests for empathy than a control group.
  • An American Psychological Association survey that found that of over 3,500 U.S. parents, 58 percent say they worry about the influence of social media on their child’s physical and mental health; 48 percent say regulating their child’s screen time is a “constant battle”; and 58 percent say they feel like their child is “attached” to their phone or tablet.

 

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