Amidst legal challenges and legislative efforts to ban TikTok in the US, ByteDance, the parent company, mulls shutdown of the popular social media app in the country rather than selling it. Reuters, citing four sources familiar with the matter, revealed this potential move, highlighting ByteDance’s concerns over the app’s future in the US market.
The decision to shut down TikTok in the US comes in response to mounting legal hurdles, including recent legislation signed by President Joe Biden aimed at banning the platform from US app stores. This legislation reflects ongoing concerns over data privacy and security, particularly regarding alleged data sharing with the Chinese government, an allegation consistently denied by ByteDance.
Despite TikTok’s relatively small contribution to ByteDance’s overall revenue and user base, the parent company appears inclined to avoid selling the app to an American buyer. This reluctance stems from the essential role played by TikTok’s algorithms, which are integral to ByteDance’s operational strategies. Even in the event of a shutdown, ByteDance’s basic algorithm would remain accessible, minimizing the potential impact on revenue.
ByteDance declined to comment on the matter but took to its media platform, Toutiao, to clarify that there are no imminent plans to sell TikTok. However, reports suggest that ByteDance has explored alternative options for selling TikTok’s US business without including its recommendation algorithm. Despite these uncertainties, TikTok’s CEO remains confident in overcoming legal challenges, highlighting the platform’s significant American user base and revenue contribution.
Follow us on Socials: