Sept 18, 2020 Update: The US Commerce Department announced Friday that it will shut down or ban TikTok and another popular Chinese app WeChat. The ban comes into effect on Sunday, Sept.20. President Trump is blocking new downloads of the video-sharing app from Sunday even as Oracle, Walmart and other investors are trying to clinch a deal to buy TikTok’s US operations from ByteDance.
The Commerce Department announced the ban even before President Trump’s expected approval of Oracle’s deal with TikTok. Commerce Secretary Wilbur Ross said in a statement that the decision to ban TikTok and WeChat was taken “at the President’s direction” to prevent the Chinese from collecting the personal data of American citizens.
President Trump had given TikTok’s parent ByteDance until September 15 to find an American buyer for TikTok’s US operations. The Trump Administration would bar Apple’s App Store and Google’s Play Store from offering the banned apps on their platforms in the US. The basic TikTok will remain available to the US users until November 12.
Aug 13, 2020 Update
TikTok’s parent company ByteDance is the world’s most valuable startup, valued at around $100 billion. But 2020 hasn’t been a particularly good year for the Chinese short video app. TikTok has clocked more than 2 billion downloads worldwide, putting it in the same league as Facebook, YouTube, and Instagram. But a lot of TikTok users are concerned that the Chinese app could be banned. And their concern is valid. So, will TikTok shut down in 2020? Let’s find out.
Why TikTok users think the app could shut down in 2020?
Google Trends data suggests that millions of TikTok users in the US and other parts of the world worry that the app could shut down and disappear from the App Store and Play Store.
Last month, India banned 59 Chinese apps including TikTok, saying the apps were a “threat to sovereignty and integrity” of the country. India expressed concerns that these apps could be actively sharing data with the Chinese government. Or Beijing could use these apps to influence the general public. India banned the apps after a deadly border clash between Indian and Chinese soldiers.
Given the Communist Party has close ties with the Chinese businesses, governments and security agencies in other countries have reasons to worry. The Wall Street Journal found that a lot of TikTok users are praising China in their videos because praising China somehow increases the reach of their videos. TikTok has also been accused of removing content critical of China on its platform.
The US looking at banning TikTok
After India banned the Chinese apps, the US and Australian officials indicated that they were also looking into the possibility of shutting down TikTok. The Chinese company has denied the possibility of a ban in Australia, though.
On July 8th, the US Senator Rick Scott said in a tweet that the Chinese government was using apps like TikTok to “spy on Americans.” The US is one of the largest markets for TikTok. While Chinese apps are allowed in the US, popular American companies such as Google, Facebook, YouTube, WhatsApp, Snapchat, and Instagram are banned in China.
The US Secretary of State Mike Pompeo said earlier this week that the US government was “certainly looking at” banning Chinese social networking apps including TikTok. It poses risks to national security, said Pompeo. President Donald Trump later confirmed that “It’s something we’re looking at.” The Trump administration has already taken action against China’s ZTE and Huawei.
The US is currently probing allegations that the ByteDance-owned app has violated children’s privacy. The UK is also considering a ban on the Chinese short video app. However, experts believe TikTok is unlikely to shut down in the UK.
TikTok withdraws from Hong Kong
Just days after China passed a new national security law and tightened its grip on Hong Kong, TikTok announced that it would withdraw from the region. The new national security law gives the Chinese government sweeping powers in Hong Kong. Any individual or business not complying with the Chinese government orders could face severe consequences including life imprisonment.
Will TikTok shut down in 2020? ByteDance goes an extra mile to avoid the ban
ByteDance doesn’t want to suffer a ban in any more countries, having already lost the Indian market. The Chinese company has been facing the heat for more than a year. It has been trying to overhaul its image to become a trustworthy company. It has hired former Disney executive Kevin Mayer, an American, as its CEO.
ByteDance has also been constantly assuring the regulators and users that it doesn’t share user data with the Chinese government. It’s difficult for a Chinese company to convince the rest of the world that it can say no again and again to the Chinese government or Community Party. Most business people in China have deep ties with the Communist Party.
According to a report from the Economic Times, ByteDance is considering changing the corporate structure of its app business to avoid intense regulatory scrutiny. It is exploring the idea of setting up a new management board for TikTok or even set up a new TikTok headquarters outside China. Moving TikTok headquarters outside China would at least give a perception that it has distanced itself from Beijing.
A TikTok executive told the Economic Times, “We remain fully committed to protecting our users’ privacy and security as we build a platform that inspires creativity and brings joy for hundreds of millions of people around the world.”
So, will TikTok shut down in 2020? Several countries are considering a ban. But a $100 billion company is not going to shut itself down. It will find out a way to stay operational, even if it means moving the headquarters to another country.
Microsoft could buy TikTok operations in US
Soon after the US President Donald Trump threatened to ban TikTok, the video app’s owner ByteDance started exploring the option to sell its US operations. TikTok has more than 140 million users in the US. It’s better to sell the operations instead of getting banned.
Microsoft CEO Satya Nadella held a meeting with President Trump to convince him that instead of banning the app, Trump should let Microsoft explore a buyout. The US President has given Microsoft and ByteDance until September 15 to reach a deal. The US committee on foreign investment will be observing the transaction the whole time.
There is little possibility of a TikTok shutdown in 2020. A sale to Microsoft or another US company should address the US government’s primary concerns, allowing the app to stay alive in the country. Microsoft is reportedly interested in buying the US, UK, and Australia operations of TikTok. Venturing into social networking would be a new adventure for business-focused Microsoft.
TikTok Shut down or ban in India
According to a recent report, the Indian Ministry of Electronics and Information Technology (MEITY) has issued a list of 79 questions to the 59 banned Chinese apps, including TikTok. Furthermore, the ministry added that the apps only have until July 22 to respond to the questions. And if no response, it’ll go ahead and ban them permanently from the country.
According to government sources, the ministry was able to back up the notice, constitutionally. Have a look at a brief of what the notice looks like below:
Action against the apps was initiated under Section 69 of the IT Act and powers vested with the Government of a sovereign nation.
MEITY has been receiving information about the operations of the 59 banned apps from the global cybersecurity experts and Indian intelligence agencies. In case any of the companies respond to the 79 questions, the ministry will match it with the available information. And if there’s any inconsistency, it could result in big trouble for such app(s), sources said.
Talking about the questions, some of them include knowing their corporate origin and funding. Apart from that, others include the structure of their parent companies, company practices, data management, their servers, and many more.
Even Companies Have Started Banning The App
Another report reveals, apart from countries, a few companies have also started banning the app in the US. Last week, Amazon banned the TikTok app for a few hours, before unbanning it. While the reason for that is still unclear, the company was able to refer to the move as a “mistake”.
Another US company Wells Fargo has also banned its employees from using the app. While stating the reason for its decision, the company mentioned that it’s “due to concerns about TikTok’s privacy and security controls and practices.” Apart from that, the company also gave another reason, stating that “corporate-owned devices should be used for company business only.”
Among other companies that have so far banned the usage of the TikTok app include the Republican National Committee and the Democratic National Committee (DNC).
These reports add up to the worries of TikTok users that the app could shut down in 2020.
Trump’s TikTok attack escalates China vs. US trade war
U.S. President Donald Trump has issued an executive order that could ban TikTok from the U.S. On August 6, Trump’s executive order banned U.S. financial transactions with Chinese company ByteDance, owner of the TikTok app. The ban will come into effect 45 days after the executive order.
According to Trump, if the app doesn’t find an American buyer, it will face a ban from the U.S. because it represents a so-called national security threat. Growing immensely popular all throughout the world during the coronavirus quarantine, the TikTok app has clocked more than a billion downloads around the globe, totaling 175 million downloads in the U.S. alone.
The threat to ban the app if there is a no sales agreement with Microsoft by September was viewed with great suspicion in Chinese public opinion. The press in China has classified the measure as an attempt to steal Chinese technology.
Trump’s decision is in line with Washington’s recent stance on Beijing. The subsequent announcement that Trump expects the U.S. to receive a percentage of the possible sale of TikTok to an American company is a major escalation in the economic war between the U.S. and China.