TikTok will be banned in the United States on Jan. 19, 2025, after a federal appeals court rejected its bid to overturn ban signed in April
A federal appeals court rejected its bid to overturn the ban that President Biden signed in April. The law states that if TikTok’s parent company, ByteDance, doesn’t divest its ownership to non-Chinese companies, the app will be banned in the U.S.
In an article from TikTok Newsroom Blake Chandlee (TikTok’s President of Global Business Solutions), expressed the importance of the platform. “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.”
Oxford Economics has highlighted the significant reliance of various industries on TikTok, particularly the food and beverage, health and wellness, and business service sectors. These industries have found TikTok to be a powerful platform for marketing and engagement, contributing billions to the overall GDP.
For example, businesses in the food and beverage sector utilize TikTok to showcase their products creatively, often leading to viral trends that can drive substantial sales. Similarly, the health and wellness industry leverages the platform to promote fitness tips, healthy recipes, and wellness products, effectively reaching a younger audience that values authenticity and community. The business services sector also benefits from TikTok by using it to share insights, advice, and services in a more relatable manner, helping to attract potential clients and build brand awareness.
The collective economic impact of these industries illustrates how crucial TikTok has become in shaping consumer behavior and driving economic growth. If the ban were to be enforced, it could disrupt these thriving sectors, leading to significant financial repercussions not only for the businesses directly involved but also for the broader economy.
Small business owners from various fields say that TikTok has changed their businesses. Felicia Jackson, the owner of CPR Wrap, said that TikTok generated more than $300,000 in sales in only two days, helping to save her business.
“It’s amazing,” she told TikTok Newsroom. “And the best part is, our product has saved two lives because people saw it and purchased it on TikTok.”
In a similar way, Desiree Hill, a mobile mechanic, pointed to her swift business growth – such as leasing a 9,000-square-foot shop and hiring five employees – as being due to her success on TikTok.
The ban presents serious challenges for creators like Shira, a 27-year-old who depends on TikTok partnerships for her income. Shira mentioned to BBC that she has invested many years in building a loyal audience and that TikTok generates the highest revenue among all the platforms she utilizes.
“I’m not sure what all these people are going to do if the ban goes through,” says Shira. “There is no unemployment for creators or fallbacks.”
Kristen Schiele, a marketing professor at USC, told BBC that businesses targeting Gen Z on TikTok may struggle to find similar audiences elsewhere. She also mentioned that international brands might have a tougher time connecting with U.S. audiences.
“There’s a lot of cosmetic brands and skin care brands coming from Korea, especially and China,” Schiele said. “That’s a big thing [on TikTok] right now … those different beauty regimens and the great skin care products that they have.”
TikTok CEO Shou Zi Chew has characterized the proposed ban as an infringement on free expression. In a video from April, he emphasized the seriousness of the situation by saying, “This is a ban, a ban on TikTok and a ban on your voice.” His statement underscores the belief that banning the platform not only silences the company but also silences the millions of users who express themselves through it. Chew’s comments reflect the broader implications of the ban, suggesting that it threatens the ability of individuals to share their thoughts, creativity, and experiences with a global audience. This perspective raises important questions about the role of social media in facilitating free speech and the potential consequences of restricting access to platforms that empower users to connect and communicate.
The potential consequences of the TikTok Ban could be extremely severe for millions of users and businesses. According to information from TikTok Newsroom, small businesses that rely on TikTok as a marketing platform could face losses exceeding $1 billion in revenue within just one month if the ban is enacted. This is a significant amount that highlights how integral TikTok has become for many small enterprises.
In addition to the impact on businesses, creators on the platform could see nearly $300 million in earnings vanish as well. This loss not only affects individual incomes but also disrupts the communities and networks that TikTok creators have built over time. These creators have cultivated their audiences and developed unique content that resonates with their followers, making the platform a vital part of their livelihoods. Overall, the ban could dismantle a crucial ecosystem that supports both small businesses and content creators, leading to widespread economic repercussions.
On Dec. 9, TikTok announced that it had taken legal action, filing an emergency motion for an injunction to delay the ban while the U.S. Supreme Court reviews the case. TikTok has reiterated its commitment to safeguarding its 170 million U.S.-based users and preserving the opportunities it creates for businesses, creators and the economy at large.
