ByteDance, owner of TikTok, said it is willing to close the platform’s operations in the United States. The decision may occur if all the company’s legal options are exhausted against legislation that seeks to ban it from North American territory.
According to the Reuters agency, TikTok’s algorithms, essential for ByteDance’s operation, make the app’s sale unlikely.
Read more: “Elon Musk is against banning TikTok in the USA”
However, TikTok’s revenue and number of daily active users in the US represent a small fraction of ByteDance’s total. Therefore, in case of a ban, the company would rather disable the app in the US than sell it to a North American buyer.
The deactivation would have little impact on ByteDance’s business, which allows the company to maintain its core algorithm.
Biden signs law to ban TikTok in the US
The context of a possible ban on TikTok in the US is the recent decision of US President Joe Biden. On Wednesday 24th, he sanctioned a new law that prohibits the use of the TikTok application in the country.
A ByteDance You have nine months to sell TikTok to a non-Chinese company. Otherwise, access will be blocked in the US.
Read more: “Former Secretary of the Ministry of Justice claims that TikTok was banned in the US and is ‘checked’ on Twitter/X”
The justification of supporters of this law is the growing concerns about data security and user privacy, due to China’s relationship with ByteDance. The fear is that the company would be forced to share data with the Chinese government.
CEO responds to Biden
In the context of discussions about the sale of TikTok, ByteDance issued a statement last Thursday, 18th, through Toutiao, its media platform. The company and denied plans to sell.
The statement occurred due to an article from the North American website The Information, which suggested that ByteDance intended to sell TikTok’s business in the USA. The supposed sale would occur without the inclusion of the algorithm that recommends videos to users.
In response to the North American president, Shou Zi Chew said that the company will take legal action. He classified the measure as “ironic” because TikTok “reflects the same values of freedom of expression as the United States”.
“Rest assured, we’re not going anywhere,” he said, in a video posted moments after Biden signed the law into law. “The facts and the Constitution are on our side and we hope to prevail again.”
Find out more: “European Union threatens to ban TikTok Lite for being ‘as addictive as cigarettes’”
According to Reuters, it would be impossible to divest TikTok with its algorithms, as the intellectual property license is registered under ByteDance in China, complicating the separation from the parent company.
The short video social network has 170 million North American users. ByteDance’s financial operations, mostly originating from China, continue to not be publicly disclosed.
However, it was revealed that the company’s revenue will increase to around $120 billion in 2023. TikTok in the US only accounts for around 5% of ByteDance’s global daily active users.
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