TikTok has filed an emergency appeal to the U.S. Supreme Court to delay enactment of a law that could force a nationwide ban on the app unless its Chinese parent company ByteDance sells its ownership by January 19. .

ByteDance previously said it had no such plans.

After the Jan. 19 deadline, TikTok will be removed from app stores and will no longer be accessible to U.S.-based internet providers.

background

TikTok was launched in 2017 as the international version of the Chinese app Douyin, which was launched in September 2016 by ByteDance.

Since then, the platform has skyrocketed in popularity, becoming a hub for entertainment, viral trends, and political discussion. ByteDance acquired American lip-syncing app Musical.ly in 2017 for about $1 billion. It was integrated into TikTok the following year.

By 2021, TikTok had over 1 billion users worldwide.

worried government

India banned TikTok in 2020, and the European Union voiced privacy concerns.

Efforts to restrict TikTok in the United States date back to President-elect Donald Trump’s first term. In 2020, President Trump issued an executive order forcing the sale of TikTok’s U.S. operations, but the order was challenged in court and ultimately rescinded by President Joe Biden in 2021.

But under the Biden administration, concerns about China’s access to user data continued. On April 24, 2024, Biden signed the Protecting Americans from Foreign Adversary Regulatory Applications Act. This law marked the transition from executive order to formal Congressional action. Under the law, social networking services (including websites and application software) can be banned within 270 to 360 days if the U.S. President and related regulations determine that they are “applications controlled by a foreign enemy.” be. This law expressly applies to ByteDance and its subsidiaries (including TikTok) without the need for further determination.

TikTok challenged the law, arguing that it constitutes an unconstitutional restriction on free speech. However, on December 6, 2024, the D.C. Circuit Court of Appeals dismissed TikTok’s claim. TikTok has appealed to the Supreme Court following this ruling, and content creators are also filing parallel appeals.

What’s the problem?

There are three important concerns.

• Data privacy. Critics claim that TikTok collects too much user data, including location information, browsing history, and biometric data. Although TikTok claims its data collection is in line with industry standards, some cybersecurity analysts believe that China’s 2017 state law mandated that Chinese companies assist in government intelligence efforts upon request. We believe that the Chinese government may have access to information under the Information Act.
• National security. U.S. officials have long worried that TikTok could serve as a conduit for Chinese espionage and influence operations. Former President Trump’s executive order specified that TikTok’s data collection could be used for surveillance, blackmail, and espionage. TikTok’s “Project Texas” initiative aims to address these concerns, storing U.S. data on Oracle servers in Texas.
• Content manipulation and misinformation. Critics argue that TikTok’s recommendation algorithm can be exploited for influence manipulation. FBI Director Christopher Wray has warned that the Chinese government could use TikTok’s algorithms to manipulate the content Americans watch.

Some experts argue that these risks are unproven and remain “theoretical.” In particular, a study by Georgia Tech found that TikTok’s data collection is similar to other social media platforms. But evidence that ByteDance employees improperly accessed user data in December 2022 sparked new alarm.

Market impact

ByteDance itself is a private company. However, a ban could have a variety of effects.

“Winners” from the ban would include Meta, Snap, and Google. If TikTok’s 170 million U.S. users are forced to leave the platform, other social media platforms could gain new users and ad dollars. Meta’s Instagram Reels and YouTube Shorts could see a spike in user engagement.

The “losers” will include ByteDance and private equity investors. ByteDance’s valuation, estimated by some to be more than $200 billion, could face a significant drop. Sequoia Capital and SoftBank could see their stakes lose value, especially if TikTok comes under pressure and sells at a discount.

Content creators who receive promotion or direct benefits (through the TikTok Creator Rewards Program) will obviously be affected.

The ban could signal increased regulatory pressure on other Chinese-owned apps and tech companies operating in the U.S., such as Alibaba and Tencent, and could prompt U.S. allies to take similar legislative action. There is sex.

What’s next?

TikTok argues in its appeal that the law protecting Americans from applications controlled by foreign adversaries violates the First Amendment rights of both the company and its 170 million U.S. users. are. The company is asking the Supreme Court to block the law until it has a chance to consider its constitutional claims based on regular filings. The case now goes to Chief Justice John Roberts, who can decide it alone or refer it to the en banc court for a vote.

If the Supreme Court rejects TikTok’s appeal or declines to hear the case, the January 19 deadline will remain in place. President Biden has the option of granting TikTok a 90-day extension if ByteDance makes “meaningful progress” toward a sale, but there is no indication he will do so yet.

TikTok asked for a decision by January 6 to give app stores and internet providers time to comply if the law goes into effect.

President Trump has also voiced support for TikTok and spoken out on the issue, despite his own attempts to ban it. “I have a warm spot for TikTok,” he said at a press conference, hinting at possible intervention after he takes office on January 20.