It’s been a nerve racking weekend for TikTok US users. Ahead of the legal ban coming into effect on Sunday the 19th, late on Saturday evening TikTok took the decision to switch off all US services.
After they went dark, TikTok US users were greeted with a message stating ‘We’re working to restore our service in the US as soon as possible, and we appreciate your support. Please stay tuned.’
TikTok had indicated that they needed more from outgoing President Biden than his statement that he would leave the issue to his successor, Donald Trump.
Then on Sunday, after incoming President Trump stated that he would issue an executive order on Monday,, giving TikTok a reprieve, TikTok came back online to the relief of those reliant on the platform for their income.
Many have suggested that Meta and Google would be only to pleased to mop up advertising dollars, should TikTok disappear. That however misses the point as neither have anything even vaguely resembling TikTok Shop. TikTok shop powers millions of small businesses revenues, either through direct selling or through the TikTok affiliate program enabling them to earn through promoting products and making a commission on sales.
The economics of TikTok make allowing the app to be entirely banished from the US pretty dire – and to be fair that’s not actually what legislators wanted – they simply want it sold and not, as they stipulate, controlled by the Chinese Government – something that TikTok deny. TikTok US say that their app supports:
- $14.7bn SMB Revenue in the US
- Contributes $24.2 billion to US GDP
- 7 million businesses in the US rely TikTok
- Supporting 224,000 jobs
- Of which 98,000 jobs are directly within SMBs using TikTok
- SMBs supported $5.3 billion taxes
- TikTok’s operations contributed $8.5 billion taxes
What the day long shut down of TikTok US appears to have done is to ensure the credit for keeping TikTok live in the US goes to incoming President Trump, rather than the outgoing President Biden, who to be fair appears to have reversed is position and also doesn’t want TikTok shut down. After today’s inauguration, watch for the new President’s executive order as that will be the first indication of his strategies for TikTok and how he plans to find a solution to keep TikTok running, avoid fines for the likes of Oracle, Google, Apple and other tech providers, and keep Congress happy.
