The Proposed TikTok Ban: Everything You Need to Know

By: Keith Wagstaff · April 23, 2024 · Reading Time: 3 minutes

TikTok in Trouble

Get your scrolling in now, the House of Representatives just passed a bill on Saturday that could result in a TikTok ban.

House Republicans tied the TikTok legislation to aid for Israel and Ukraine, increasing the odds the Senate would pass the bill, possibly as early as this week. Lawmakers have claimed TikTok’s ownership by Chinese parent company ByteDance is a national security risk.

If the bill is passed by the Senate and signed by President Joe Biden, ByteDance would have nine months from when the rule became law to sell TikTok, with a possible extension of another three months. China has signaled it would block any sale. And if that happened, TikTok would effectively be banned in the United States.

The (Potential) Aftermath

To say a lot of Americans would be affected by this would be an understatement; TikTok has 170 million users in the United States. In a Pew Research Center poll from December, only 38% of U.S. adults supported a ban. That number dropped to 18% for teens.

Many smaller companies, especially in the beauty and fashion industries, rely on TikTok for exposure and sales. Larger brands have also made it a key part of their marketing strategies. And last month, TikTok influencers protested in Washington, D.C., over an earlier version of the House bill, claiming a ban would make it harder for them to make a living and gain an audience.

It’s possible the law would result in lawsuits from TikTok and creators using the platform.

Who Wins, Who Gets Hurt?

Meta (META) and Alphabet (GOOGL), whose Reels and Shorts, respectively, are very similar to TikTok, could be the main beneficiaries of a ban, as consumers and brand’s advertising budgets may flock to other social media platforms.

Meanwhile, Susquehanna International Group, which owns about a 15% stake in TikTok, and other investors in the company, including Sequoia Capital, might not be thrilled if the bill passes. But several potential buyers have been tipped or voiced their interest in the past months, including an investor consortium around former Treasury Secretary Steven Mnuchin.

Who would “lose out” the most? Arguably teens. While social media use among minors has increasingly been a topic discussed by lawmakers and advocates, the status quo is a whole generation on the app: Pew Research Center found that 67% of teenagers use TikTok and 16% are on the platform “almost constantly.”

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