US House Votes to Ban TikTok Unless ByteDance Sells It

The United States House of Representatives ratified a bill on Wednesday that might precipitate a nationwide prohibition on TikTok if its Chinese parent company ByteDance fails to divest its stake in the popular social media platform within six months of the bill’s enactment.

The bill essentially proffers ByteDance two alternatives: relinquish TikTok or confront a proscription.

Should ByteDance opt to divest its shares, TikTok will persist in its operations within the United States subsequent to the president’s determination, via an “interagency process,” that TikTok is no longer under the dominion of foreign adversaries. The bill additionally mandates ByteDance to relinquish control of TikTok’s renowned algorithm, which customarily delivers content to users based on their inclinations.

In the event that the company elects not to sell, TikTok will be barred from application stores such as Apple and Google, along with web hosting services, until a transaction materializes.

Policymakers from both political factions, law enforcement, and intelligence authorities have long voiced apprehensions that Chinese authorities could compel ByteDance to surrender data on 170 million U.S. TikTok users.

These apprehensions arise from an array of Chinese national security statutes that necessitate organizations to aid in intelligence gathering endeavors—statutes that ByteDance might be compelled to adhere to—and other extensive means by which China’s authoritarian regime exercises authority.

Nevertheless, the U.S. government has yet to furnish any evidence that TikTok has shared such information with Chinese authorities.

The bill passed by the House will now proceed to the Senate. If ratified by both chambers of Congress and endorsed by President Biden, ByteDance will have 180 days to vend TikTok to eligible buyers.

The bill is likely to encounter legal challenges from TikTok, as the company has litigated against other efforts to proscribe the platform.

While numerous influencers and small enterprises depend on TikTok for revenue, the bill will impinge on their livelihoods if enacted into law. Users may endeavor to circumvent the prohibition by utilizing a virtual private network (VPN), but this also raises supplementary security concerns.

Collectively, this bill once again ensnares TikTok in a precarious predicament and casts a pall over the future of this Chinese technology company in the United States.

Following the vote, TikTok seemed to revive its endeavor to empower users to lobby Congress, dispatching another notification urging users to contact their district legislators. A similar initiative last week inundated congressional offices with calls, amplifying their resistance to the company.

On Wednesday, a modest assembly of supporters convened outside the White House to denounce the bill. Tiffany Yu, a young advocate for disability rights from Los Angeles, conveyed to the media the significance of this platform to her advocacy work.

“Fifteen years ago, I could only aspire to reach 30 to 40 people,” she remarked. Now, she commands a following numbering in the millions. Another protester, Ophelia Nichols, underscored the adverse repercussions of the bill on American enterprises.

“It’s profoundly disheartening that the House of Representatives is pursuing this course,” she lamented.

Mona Swan, a 23-year-old content creator, disclosed that the income she accrues from the app has been supporting her mother’s mortgage and her siblings’ college tuition.

“It’s truly disconcerting to face dismissal at this tumultuous juncture in my life, and in the lives of numerous other creators,” Swann informed Reuters.

A spokesperson for the Chinese Ministry of Foreign Affairs remarked, “Although the United States has yet to uncover evidence that TikTok poses a threat to U.S. national security, it has persisted in suppressing TikTok.”

“This form of coercive conduct, which is incongruous with fair competition, obstructs the normal commercial activities of enterprises, undermines international investors’ confidence in the investment climate, and disrupts the established international economic and trade order, and is bound to be counterproductive.”

Nonetheless, White House spokesperson Karine Jean-Pierre contended that the bill merely endeavors to ensure that ownership of major technology platforms operating in the United States “does not fall into the hands of those who might exploit them.”

Even if ByteDance is eventually permitted to offload its stake in TikTok, it remains uncertain whether its competitors will possess the requisite capital to mount an acquisition bid. The company had previously appraised TikTok at approximately $268 billion, a valuation that might deter certain investors.

However, analysts informed the BBC that there would be a multitude of potential buyers in the United States. There also arises the question of the ultimate deal to be struck, given the costs and antitrust concerns confronting the technology sector.

Jasmine Engberg, an electronics marketing analyst, informed the BBC, “All the major social media companies will express interest, but I anticipate they will confront considerable antitrust impediments… There are also smaller companies in the social media sphere, such as Snapchat. Companies will express interest, but may lack the financial means for an acquisition.”

When the Trump administration mandated the sale of TikTok in 2020, some of the largest U.S. corporations, including Microsoft, explored making offers when TikTok was valued at around $50 billion.

Ultimately, Microsoft was outmaneuvered by a consortium led by supermarket chain Walmart and software behemoth Oracle, helmed by Larry Ellison and Safra Katz, who maintain ties to the Trump administration. However, amidst legal challenges and a change in administration, the deal failed to materialize.

Presently, TikTok’s reach and advertising revenue have experienced substantial growth. Research firm Electronic Marketing approximates that TikTok’s U.S. advertising revenue will soar to approximately $8.66 billion this year, compared to less than $1 billion in 2020.

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