TikTok Tension: The Battle for ByteDance in the U.S

Written By: Kendal Hill

The fate of TikTok, an app used by approximately 170 million Americans, has become a central issue in Washington these past few weeks amid national security and foreign influence concerns. TikTok is a social media platform where users create and share short-form videos. It is owned by its Chinese parent company, ByteDance. On Wednesday March 13, the U.S. House of Representatives passed a bipartisan bill with a vote of 352-65, mandating ByteDance to divest its U.S. assets within six months or face a nationwide ban, representing one of the most significant threats to the social media app in the U.S. since the Trump administration.

Proponents of the bill primarily argue that the TikTok app is a threat to national security due to its Chinese ownership. More specifically, the bill’s supporters contend that a forced divestiture is “necessary to address the potential for the Chinese government to use TikTok for data harvesting and propaganda.”

If the legislation went into effect, it would give ByteDance 180 days to sell its U.S. TikTok operation to a purchaser approved by the U.S. government, ensuring ByteDance relinquishes all control over TikTok and its content-recommending algorithms. Failure or refusal by ByteDance to sell TikTok would render it illegal for app stores and web hosting providers to distribute or update the app in the United States, subjecting any company collaborating with TikTok or providing its app for download to potential sanctions by the Justice Department.

Despite the bill quickly passing through the House by a wide margin, the measure still must be approved by the Senate before making it to President Biden, who has already expressed support for the legislation. The fate of the bill remains largely uncertain in the Senate, where similar legislation was introduced and ultimately blocked. Opponents of the legislation contend that such a measure would infringe upon the freedom of expression of TikTok’s users. Some argue that the bill’s swift passage through the House overlooked significant antitrust and privacy concerns, prompting their resistance. Concerns have also been raised about the potential for the bill to pave the way for the prohibition of other services, “such as the Telegram social media app or the stablecoin Tether.”

Even if the legislation passed through the Senate and the President, the consequences of forcing the sale of TikTok would be multifaceted. Firstly, the purchase of TikTok by another entity would likely trigger antitrust scrutiny, given the platform’s significant market presence. With an estimated 170 million users in the U.S. alone, TikTok would carry an estimated price tag of over $100 billion, which few companies or individuals could afford to purchase. Some companies that could potentially afford this high-ticket acquisition are “tech giants” such as Microsoft, Google, and Meta. However, the acquisition of TikTok by any of these companies would likely raise concerns over antitrust violations, potentially leading to further governmental scrutiny.

Additionally, the forced sale raises constitutional issues, with many of the legislation’s opponents arguing that such a measure would violate American users’ First Amendment rights by curtailing their freedom of expression. As a widely popular social media platform, TikTok provides a platform for users to share their thoughts, opinions, creativity, and engage in public discourse. By effectively prohibiting TikTok in the U.S., many argue that Americans would be deprived of a vital means of communication and expression, thereby restricting their ability to participate in the exchange of ideas and viewpoints. This restriction on access to a digital forum could therefore undermine the protections of freedom of speech and expression, safeguarded by the First Amendment.

Such challenges present prolonged legal battles for ByteDance and uncertainties regarding the implementation of the bill. Moreover, the potential precedent set by this legislation could have broader implications for the regulation of other digital platforms and services, further complicating the regulatory landscape.


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