Recently, news emerged about a new bill aiming to compel ByteDance to divest TikTok or face a ban in the US. The bill has now been approved by the US House of Representatives with considerable bipartisan support, garnering a 352-65 vote.
The next hurdle for the bill is the Senate. Despite opposition from Senator Rand Paul, there remains a glimmer of hope. However, should the bill make its way through, President Joe Biden has expressed willingness to sign it into law, despite the fact that his reelection campaign aligned with TikTok just a month prior.
In 2020, various US companies showed interest in acquiring TikTok’s global operations, with Microsoft being one of the interested parties. TikTok serves as the global counterpart to the Chinese social platform Douyin. However, the sale was met with resistance from Chinese authorities.
If the bill gets signed into law, ByteDance would be mandated to sell TikTok within six months. Following this, US companies would be prohibited from hosting ByteDance apps on their app stores or providing web hosting services, resulting in TikTok being banned from platforms like the Apple App Store and the Google Play Store.
Despite these developments, many legal challenges remain. Notably, last year, Montana enforced a ban on TikTok, but a federal judge later overturned it. ByteDance and Chinese authorities are expected to pursue alternative strategies.
TikTok boasts a massive user base, having reached 1 billion monthly users in 2021. It was also the first app to achieve $10 billion in in-app spending last year. The legal outcome will significantly impact potential earnings and losses in this lucrative market.
It’s worth noting that TikTok is not the only platform facing scrutiny. The Protecting Americans from Foreign Adversary Controlled Applications Act could also affect other platforms such as WeChat, owned by tech behemoth Tencent.
Various organizations within the US are against the ban. Entities like the Electronic Frontier Foundation, the American Civil Liberties Union, the Center for Democracy, and the Fight for the Future organization have voiced their opposition, even addressing the House of Energy and Commerce Committee on this issue. The EFF and ACLU have actively supported overturning the Montana ban.
Referencing a blog post from the EFF, they stated: “Instead of passing this overreaching and misguided bill, Congress should focus on preventing any company, irrespective of its origin, from amassing extensive personal data, which can then be exploited by data brokers, US government agencies, and even foreign adversaries like China. Instead of wasting time on a law that could potentially stifle the speech of millions of Americans, Congress should address the actual issue of rampant privacy violations by enacting comprehensive consumer data privacy legislation.”
