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What Would a US TikTok Ban Mean for Businesses?

TikTok application

The popular short-form video-sharing app continues to face scrutiny over national security concerns.

Participants Hold Signs In Support Of Tiktok Outside The Us Capitol Building On March 13, 2024 In Washington, Dc. Credit: Getty Images / Anna Moneymaker
Participants Hold Signs In Support Of Tiktok Outside The Us Capitol Building On March 13, 2024 In Washington, Dc. Credit: Getty Images / Anna Moneymaker

The US is currently pushing forward with a controversial bill that could result in TikTok becoming banned in the country. 

The TikTok bill was voted through the House of Representatives yesterday (13 March) after being waived through the economics committee with a unanimous 50-0 vote last week. It will now go to the Senate. 

TikTok continues to refute claims that it has, or ever will, share US user data with Chinese authorities.

What is the TikTok bill?

If the bill came into force, Chinese company ByteDance would be forced to sell its stake in the US version of TikTok or face an immediate ban of the app in the country. 

The bill would grant the president new powers to designate apps with more than a million active users a security risk, subjecting them to curbs and bans.

ByteDance would have around five months to divest TikTok. In addition, app stores would have to stop supporting the app and all other services tied to ByteDance. 

Representative Frank Pallone said he hopes the divestment of TikTok will enable Americans to “continue to use this and other similarly situated platforms without the risk that they are being operated and controlled by our adversaries”.

Will the TikTok bill pass?

The recent vote in the House of Representatives marks the most significant threat to TikTok yet, in a multi-year dispute over allegations that China-based ByteDance could collect user data.

TikTok faced an attempted ban by Donald Trump in 2020, and efforts ramped up again recently when a state-level ban was passed in Montana. The courts blocked both of the bans on grounds of first amendment violations. 

In a major reversal last week, Trump opposed a TikTok ban claiming the bill would give unfair advantages to Facebook owner Meta.

“Without TikTok, you can make Facebook bigger, and I consider Facebook to be an enemy of the people,” Trump said in an interview with NBC.

Although the bill has successfully passed through Congress, it is not guaranteed to pass the Senate as easily. Some Senate members have been vocal in their opposition to the bill, many citing First Amendment concerns. 

Mike Gallagher, the Republican’s chairman of the House select China committee, has maintained that the bill is not an outright ban and urged ByteDance to sell. 

“TikTok could live on and people could do whatever they want on it provided there is that separation,” Gallagher said, adding: “It is not a ban – think of this as a surgery designed to remove the tumor and thereby save the patient in the process.”

What would a US TikTok ban mean for businesses?

The app is currently used by approximately 170 million Americans, with thousands of those users using the app as a source of business income.

Bruce Schneier, chief of security architecture at Inrupt, told Verdict that the internet would have to work very differently in order to completely “ban” something from the internet but the US can still stop businesses doing work with TikTok.

“The best that the US can do is to ban US companies from doing business with TikTok, which is basically what the House just voted on,” Schneier said.

“That would mean that Americans wouldn’t be able to receive money from TikTok for their content,” he added.

Schneier believes there will be many workarounds for US users and businesses to stay using the app, even if a ban was enforced.

Banning TikTok from Google and Apple app stores would “immediately stop new updates for current users and prevent new users from signing up” but wouldn’t completely remove the app from people’s phones, Schneier explained.

“Nor would it prevent Americans from installing TikTok on their phones; they would still be able to get it from sites outside of the US,” he added.

TikTok is used by businesses for customer data collection. Some have speculated that the loss of the platform could lead to substantial data loss.

“As brands on both sides of the Atlantic prepare for a ban on TikTok, it is critical the platform’s absence does not create a data void,” Andrew Stephenson, marketing director for EMEA & India at Treasure Data told Verdict.

“Brands should see recent uncertainty around TikTok as a moment to build a watertight view of their customers using a multitude of connected data sources,” Stephenson said.

Source from Retail Insight Network

Disclaimer: The information set forth above is provided by retail-insight-network.com independently of Alibaba.com. Alibaba.com makes no representation and warranties as to the quality and reliability of the seller and products.

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