TikTok is preparing to fight a potential U.S. ban that could affect its 170 million users in the country. The U.S. government is considering a bill that would require TikTok’s parent company, ByteDance, to divest from the app due to national security concerns. If the bill becomes law, ByteDance would have almost a year to divest from TikTok, meaning the app would likely survive through the U.S. presidential election in November.
However, unlike four years ago when the Trump administration threatened to ban TikTok and ByteDance considered selling the app, this time the company has made it clear that it has no intention of selling. Instead, TikTok’s management has vowed to challenge the bill in court if it becomes law. This sets the stage for a significant legal battle between the U.S. government and ByteDance, a $240 billion startup that has come to define China’s growing technological prowess.
The outcome of this legal battle could have far-reaching implications, not just for TikTok and ByteDance, but also for other Chinese companies with growing U.S. ambitions, such as Tencent Holdings Ltd. and PDD Holdings Inc.’s Temu. It’s also a test of how Beijing will respond to growing pressure on homegrown champions from ByteDance to Huawei Technologies Co.
Despite the looming ban, TikTok remains a major player in the U.S. market, with its revenue far surpassing any other market. The app also contributes an estimated $24.2 billion annually to the U.S. economy. However, the potential ban and the ensuing legal battle could have a domino effect, with U.S. allies possibly following suit to ban TikTok as well.
Read more at: finance.yahoo.com