Call now to find your best offers!TikTok Owner Would Rather Shut Down in US Than Sell
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ByteDance, the Chinese parent company of TikTok, will shut down its U.S. operations rather than sell the platform if the ban of the video app holds up in court.
This development comes on the heels of U.S. President Joe Biden signing a bill into law that would prohibit TikTok unless ByteDance divests the app within a 270-day window.
Inside Sources Say Sale Is Unlikely
Sources close to the matter told Reuters that ByteDance is unlikely to sell TikTok to an American buyer. The app’s secret algorithm, which powers the “For You" page, is crucial to ByteDance’s overall business beyond TikTok. The value of that algorithm makes a sale highly improbable.
TikTok accounts for only a small portion of ByteDance’s total revenue and daily active users. Even a total shutdown in the U.S. would not significantly damage the company as a whole.
In a statement released on its media platform Toutiao, ByteDance CEO Shou Zi Chew expressed confidence in overcoming legal challenges to the proposed legislation. Chew emphasized that the company has no plans to sell TikTok.
TikTok Legislation Arose from National Security Concerns
The move to ban TikTok in the U.S. stems from lawmakers’ concerns over national security and surveillance risks associated with Chinese-owned apps.
Critics allege that the app’s algorithm could allow third parties in China to spy on American users and manipulate content.
While TikTok faces an uncertain future in the U.S., the company’s CEO remains defiant. “This is a ban on TikTok and a ban on you and your voice," Chew said in a video addressing the app’s users. “Politicians may say otherwise, but don’t get confused. Many who sponsored the bill admit a TikTok ban is the ultimate goal."
The path to a potential TikTok ban in the U.S. has been complex, with the recent legislation bundled alongside substantial foreign and military aid for countries like Israel, Taiwan, and Ukraine. The Senate voted 79-18 in favor of the measure, signaling strong bipartisan support for the move.
As ByteDance gears up for a legal battle against the divestment mandate, the stakes are high for the millions of TikTok users in the U.S. The outcome of the court proceedings will determine the future of the platform in the country.
This is a ban on TikTok and a ban on you and your voice." — ByteDance CEO Shou Zi Chew
TikTok business owners object to ban
TikTok Bans Around the World
A number of countries have already banned TikTok, either completely or partially, due to privacy concerns:
India: Banned TikTok and 58 other Chinese apps in January 2020, making it the largest country to prohibit the platform.
Afghanistan: Banned TikTok in 2022 to protect young people from being “misled." The ban came from the religious authoritarian Taliban party.
Australia, Belgium, Canada, Denmark, France, the Netherlands, New Zealand, the United Kingdom, Taiwan: Introduced partial bans, prohibiting TikTok on government-issued devices or in certain ministries.
European Union: The European Parliament, Commission, and Council have imposed bans of TikTok on staff devices.
Nepal: Banned the app nationwide in late 2023 as a threat to social harmony.
Pakistan: Temporarily banned TikTok over concerns about immoral content.
Somalia: Ordered telecom companies to block TikTok nationwide for moral reasons.
India After TikTok: A Preview of U.S. Outcome?
When India banned TikTok in 2020 following a border clash with China, the app’s 200 million Indian users had to adapt quickly. Meta’s Instagram and Google’s YouTube stepped in with their own short-video features, converting many of the influencers and audiences left in the wake of TikTok’s absence.
However, the local charm that made TikTok unique in India was largely lost in the transition. Digital policy analyst Nikhil Pahwa noted in the New York Times that the TikTok algorithm was “localized to Indian content.” The algorithms of Meta and Google have not been able to highlight as well the specific local finds that surfaced on TikTok.
Despite the challenges, India’s online ecosystem has shown resilience in the face of the TikTok ban. The country now boasts the largest user bases for both YouTube and Instagram, with roughly twice as many users as either platform has in the U.S.
The Indian experience shows that if TikTok does leave the U.S. market, it’s most likely that the social media world would see a surge in users on Instagram and YouTube.
Many TikTok users have expressed concern about losing their businesses that make most of their income on the platform. But it appears that Instagram and YouTube can replace TikTok as platforms for remote work on video and the sales and sponsorships that come with the influencer life.
When Would a TikTok Ban Take Effect?
The TikTok ban is not scheduled to kick in until 2025, ifByteDance refuses to sell TikTok. But even that date is unlikely for an effective ban date.
When the state of Montana tried to ban TikTok in May 2023, the case went into the court system. A full year later, the case is still in appeals.
A national ban is likely to take even longer to move through the federal courts, litigated by a mob of high-powered corporate lawyers.
Which side will win is unpredictable, says Alan Rozenshtein, a law professor at Minnesota Law School. He suggests that the most likely strategy to maintain the U.S. ban on TikTok is the threat of foreign manipulation. “The law has a strong chance of surviving First Amendment review,” Rozenshtein writes, “But I also don’t think it’s a foregone conclusion.”
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