Why is TikTok Getting Banned? Experts Talk Reasons & Consequences

TikTok — the social media platform used by over 135 million users in the U.S., or roughly half of the population — has seen new actions from the American government in efforts to ban it.

As Techopedia reported in March, the U.S. Congress passed a new law to ban TikTok.

The law was sent to the Senate, where it was expected to be swiftly approved and later signed by President Joe Biden, who had already signaled his support.

Unexpectedly, the U.S. Senate delayed approval and asked for open public hearings so that the American people would become aware of why the social media platform — linked to the Chinese government — was a threat to national security.

Now, in another plot twist, on April 23, U.S. Congress passed a larger foreign aid package for Taiwan, Ukraine, and Israel, where conflicts are escalating — which includes legal language likely seeing TikTok banned in the U.S. unless the parent company, ByteDance, sells the business.

Why is TikTok getting banned — if the U.S. government gets its way

Techopedia spoke to experts from different sectors to understand what this means for TikTok and the public and dive into the factors driving this U.S. ban and its branched-out consequences.

Why Was the TikTok Ban Attached to the Foreign Aid Package?

Perplexed about why the ban was attached to a new law, especially one passed so swiftly, Techopedia reached out to experts for their insight.

“To boost the likelihood of passing the TikTok ban, Congress has included it in the crucial foreign aid package for Ukraine, Israel, and Taiwan,” Aron Solomon, Chief Strategy Officer at Amplify, told Techopedia.

“This strategic decision leverages the bill’s necessity to compel the Senate to address the TikTok issue, which had been stagnant since the House passed a standalone ban last March,” Solomon added.

“The foreign aid package enjoys bipartisan support and is a high priority for both Congress and the Biden administration. By attaching the TikTok ban to this essential legislation, it becomes challenging for senators to oppose the ban without also rejecting the entire foreign aid package.”

Driven by National Security and China-U.S. Geopolitical Tensions

From China’s military display and pressures in the China Sea to the global artificial intelligence fight for supremacy and revelations of Chinese cyber espionage campaigns in the U.S., the U.S.-China relationship continues to build.

On April 18, FBI Director Christopher Wray warned national security and intelligence experts and students that the risks that China poses to U.S. national and economic security are “upon us now.”

Tim Ward, CEO and co-founder of Think Cyber Security — a security company innovating software and resources to build storing security cultures — spoke about the U.S.-China relationship issue and the TikTok ban.

“While the U.S. bill to ban TikTok is driven by national security concerns, the U.S.-China trade war component masks a bigger issue — that any non-authorized or personal tools used within a work context can present a security risk.”

“Posting company data deliberately or accidentally, reusing credentials, or even filming in an office with information visible on screens presents a risk,” Ward said.

According to Ward, banning TikTok may eliminate a small fraction of this risk, but it’s a sticking a plaster on a much larger problem. Ward said that the government should focus on empowering people to spot red flags and stop unsafe behaviors that leave them exposed instead of banning platforms.

TikTok Ban Economy: How Will it Impact U.S. Pockets?

With approximately 1.2 billion global users and counting, TikTok is one of the leading social media platforms in the world, competing heavily with Instagram, Facebook, Twitter, and others. Given the potential audience reach this channel has businesses, industries, and organizations in the U.S. use it daily.

From marketing to sales, public relationships, and more, TikTok’s economy is based on ad and revenue generation, just like any other social media platform. But how could a ban affect this economy in the U.S.? Would it only affect a dozen top influencers or have a greater impact?

Recently, TikTok claimed that a U.S. ban would breach “freedom of speech” and hurt the economy. As Techopedia reported, the company warned that the ban could affect the U.S. economy, as TikTok brings $24 million annually to the nation.

Additionally, all U.S. companies that have invested money in the platform would also be affected.

Cayce Myers — a professor of public relations and director of graduate studies at the School of Communication at Virginia Tech, spoke to Techopedia about the issue.

‘The economic fallout could impact the platforms of businesses that use TikTok as a means to reach out to customers.

“They’ve spent a long time building up a brand on this platform, so they will either lose that brand equity or have to transfer it to another platform,” Myers said.

“That also creates an issue with current social media platforms getting larger, which has caused some to raise concerns about the monopoly of social media by a handful of giant corporations.”

“Generally, there will be an economic impact to those users who have invested heavily in the platform to create content and build their brand.”

Myers added that U.S. companies doing business with the platform would naturally migrate to other social media channels, such as those owned by Meta.

Anti-Business, Anti-America?

There is one notable difference between the law to ban TikTok passed by Congress in the foreign aid package and the previous law to ban TikTok, which stalled in the Senate. That difference is a time extension for the company that owns TikTok, ByteDance, which would be forced to sell the platform if they want to avoid the ban.

The sale extension — which changed from six months to up to one year — signals a slower banning process than originally proposed and reveals a more lenient and flexible approach to TikTok. Was the extension necessary, and does it show a firm resolution and political will toward the ban?

Solomon from Amplify told Techopedia that he does not believe that any law will ever ban TikTok.

“Ultimately, I don’t think there will be any law banning TikTok, as the potential political cost is too high.

 

“A TikTok ban will be perceived by many as anti-small business. These people need to be part of the Biden base, so signing something into law that will hurt this group needs to be very well thought-out, which I’m not convinced it has been to date.”

Solomon said that banning TikTok in the U.S. would have profound consequences, both domestically and globally.

“Domestically, it would remove a vital platform used by millions of Americans to express their views and access information, significantly impacting free speech and the ability of many to earn a living.

“Such a ban could also inadvertently strengthen the hold of media giants like Google and Meta, which already control a significant portion of U.S. digital advertising revenue, by reducing competition in online communication channels,” Solomon added.

“Furthermore, experts argue that banning TikTok might not effectively enhance Americans’ data privacy and security, as other data brokers and apps collect far more user data, and removing one app does not safeguard against data threats from China or elsewhere.

“Internationally, the ban could lead to the balkanization of the global internet, fostering a Cold War-style standoff with China and affecting the U.S.-China political and commercial ties.

 

“This move could be perceived as the U.S. imposing excessive restrictions or coercing ByteDance, TikTok’s parent company, into selling the app.”

The Money-Making Argument: SMBs and $15 Billion in U.S. Revenue at Stake

TikTok was fast to embrace the strategic communication defense of highlighting its economic contribution to the U.S. economy in response to the ban. The company has gone as far as creating a dedicated website where users can explore what they call TikTok’s Economic Impact.

Oxford Economics recent report, “TikTok: Helping Grow Small and Midsized Businesses and Delivering Value for Consumers Across the United States,” found that small and medium business investment in TikTok during 2023 drove nearly $15 billion in revenue in the U.S.

Blake Chandlee, President of Global Business Solutions at TikTok, said at the presentation of the report.

“Businesses across America depend on TikTok’s unique ability to help them reach otherwise unreachable customers, generate new revenue streams, and drive awareness of their brands, products, and services.

“This study demonstrates what we at TikTok already knew: it’s a game changer for small businesses and has a significant impact on the U.S. Economy.”

While TikTok’s line of argument and strategy is based on real-world data and conducted by respected researchers, it still avoids addressing main U.S. national security concerns, such as TikTok’s impossibility of declining to the Chinese government if they request U.S. user data.

Ashley Rector, Founder of Quimby Digital — a marketing and creative agency — told Techopedia that U.S. consumers have rallied, protested, and spoken out on the TikTok ban.

“The legislation was buried within the Ukraine package because it’s easier to pass. It is under the rouse that America will not tolerate injustice from global adversaries.

 

“The ramifications are widespread and horribly detrimental to the small business and creator economy. There are businesses who are completely reliant on Tiktok for sales.”

Rector is sure that the ban will lead to some companies going out of business. “Not to mention the companies who support these small businesses, from marketing agencies to fulfillment organizations,” Rector said. “There is a ripple effect.”

Ben Riggle, Managing Director, North America at Channable, agreed and shared his insight,

“TikTok has already changed the dynamics of social media in the United States and is well on its way to challenging traditional e-commerce business models.

“A ban would certainly slow some of this innovation and would likely be felt most acutely by small and medium-sized beauty and fashion brands who have relied on TikTok’s unique combination of social gamification and influencer amplification to grow quickly,” Riggle said. “At a macro level, the ban would reduce platform competition, which could ultimately hurt sellers.”

Riggle added that it seems likely we will see increasing regulatory scrutiny that will impact the e-commerce industry as laws and regulations begin to catch up to the digital economy.

Lauren Zoltick, Director of Marketing, Storyblocks — a stock video, image, and content provider for creators and businesses — dove into the TikTok ban consequences.

“The implications of this are broad and will affect different groups, industries, and people in many ways.”

Zoltick explained that, for example, TikTok shop owners will lose their stores, and influencers and creators will lose a channel for sponsored content.

“Aspiring creators will lose the channel where building an audience can happen significantly faster than other channels, based on the algorithm,” Zoltick said. “Podcasters will lose a core part of their promotional engine. And so on.”

Zoltick spoke about the recent removal of music from TikTok by Universal Music.

“Artists represented by Universal’s music were removed from the platform overnight after Universal couldn’t reach an agreement with TikTok,” Zoltick said. “Many of these artists had used TikTok to launch or accelerate their careers.

“Universal-represented artists proclaimed they had no idea how to promote their music without TikTok.”

But Tom Guarente, Vice President of External and Government Affairs at cybersecurity company Armis, told Techopedia that, despite the economic impacts, the TikTok risks are just too big.

“The concerns about TikTok are too great for organizations to ignore. The most recent report from the Office of the Director of National Intelligence acknowledges China’s increased sophistication, citing TikTok accounts created by the People’s Republic of China (PRC) to influence election behavior during the 2022 U.S. midterm elections.”

The Bottom Line

The potential ban on TikTok in the U.S. has ignited a debate between national security concerns and economic repercussions. While the U.S. government cites data security risks as the primary reason for the ban, the inclusion of the ban within a foreign aid package suggests political maneuvering.

The economic impact of the ban would be significant. Small and medium businesses, creators, and influencers who rely on TikTok for revenue and brand building would be severely affected. Additionally, a ban could stifle innovation in the e-commerce industry.

However, security experts warn that the potential for Chinese government influence on U.S. user data is a serious threat. The recent intelligence report on China’s attempts to influence elections through social media platforms underscores these concerns.

When will TikTok be banned? Ultimately, its fate in the U.S. remains uncertain. The one-year extension granted to ByteDance, TikTok’s parent company, indicates a potential for a more measured approach.

Whether a compromise can be reached that addresses security concerns while minimizing economic damage is yet to be seen.

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