Congress
passed
a
bill
this
week
that
forces
TikTok
to
be
sold
or
face
a
nationwide
ban.
President
Biden
signed
it
into
law
Wednesday,
starting
a
270-day
timer
for
TikTok
to
decide
its
future
in
the
United
States.
There’s
been
talk
about
a
ban
like
this
for
years,
but
now
it’s
actually
happening.
Bytedance, the owner of the app, has three paths available: It can fight the bill in court, and if it wins, then nothing changes; Bytedance could sell TikTok US to a local owner, though probably without its addictive algorithm; or, TikTok could just shut down and give in to the ban. Here’s how each option would play out.
A TikTok spokesperson told Gizmodo, “This unconstitutional law is a TikTok ban, and we will challenge it in court,” likely arguing these measures infringe the First Amendment. Legal experts say banning TikTok would impact the free speech of its 170 million American users, the app stores that carry it, and TikTok itself. If Bytedance wins on this argument, then the law is nullified and things go back to normal.
However, there’s no guarantee that Bytedance wins in court. While the company has a decent case to make, the United States has plenty of laws that infringe on constitutional rights for the sake of “national security.” That’s exactly the argument the United States is making here. Lawmakers have reportedly received classified briefings that show how TikTok is a “spy balloon in Americans’ phones,” alleging the app shares that information with the Chinese Communist Party. If the US can prove that in court, they might win. Then Bytedance will be left with two options for the app.
The
next
most
likely
option
is
that
TikTok
is
sold
to
a
U.S.
owner.
The
Information
reported
Thursday
that
Bytedance
was
internally
discussing
how
to
sell
TikTok
US
without
its
addictive
algorithm.
However,
Bloomberg
and
Reuters
also
reported
on
the
same
day
that
Bytedance
absolutely
would
not
sell
TikTok
under
any
circumstances.
So,
take
what
you
will
from
these
contradictory
reports.
Bytedance
doesn’t
want
to
sell,
but
it’s
considering
it
if
the
other
option
is
shutting
down
It’s
estimated
that
TikTok
could
be
worth
anywhere
from
$20
billion
to
$100
billion.
If
the
app
doesn’t
come
with
that
sweet,
sweet
algorithm
then
it’s
probably
worth
closer
to
$20
billion.
But
really,
is
the
app
worth
anything
without
the
algorithm?
Sure,
it’s
a
good
name,
and
it
has
lots
of
users,
but
if
it
sucks
to
use
then
people
will
just
leave
(See
Twitter,
now
X).
If a sale does include the algorithm, the sky is the limit – how can you put a price on something that has 170 million Americans addicted? Former Treasury Secretary Steven Mnuchin told CNBC he’s putting a band together to buy TikTok. Mnuchin did not indicate who the other investors would be, and he has no experience running a social media company. His basic qualifications are that 1) he’s rich, 2) he has rich friends, and 3) he likely still has ties with the U.S. government. That makes him a pretty strong front-runner.
In
a
sale
scenario,
it’s
possible
that
Meta,
Snapchat,
Alphabet,
or
some
other
big
tech
company
will
buy
TikTok.
However,
that
probably
opens
them
up
to
monopoly
concerns.
TikTok
by
itself
is
so
dominant,
so
owning
it
and
another
social
media
platform
might
be
a
non-starter.
There
are
very
few
people
who
could
afford
TikTok,
and
if
Bytedance
refuses
to
sell
it,
that
leaves
just
one
option.
If
TikTok’s
legal
challenge
fails,
and
a
sale
doesn’t
go
through,
TikTok
could
just
shut
down
in
the
United
States.
This
would
separate
the
most
popular
social
media
app
ever
from
the
wealthiest
user
base
on
Earth
(Americans),
so
many
people
see
this
as
unlikely.
It
would
force
Bytedance
to
walk
away
empty-handed
and
lose
tens
of
billions
of
dollars,
but
you
have
to
remember,
this
is
not
just
business,
it’s
political
as
well.
It’s a real possibility that TikTok could simply be banned, one I don’t think is being taken seriously enough. China already banned American social media apps for roughly a decade, most recently Threads and WhatsApp. American tech companies lose out on the entire Chinese market, but they don’t sell their previous algorithms and name brands to companies there. That would strip America of its competitive advantage around the world.
I think TikTok is in a similar position. Selling its algorithm to the United States would be disastrous for Bytedance, and even selling the name could be problematic. TikTok is the first Chinese app to have a meaningful presence in the United States. An outright TikTok ban would sow the United States with frustration, which could be exactly what China wants.
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