ByteDance, TikTok’s parent company, would rather shut down the app in the US than sell it if it exhausts all legal options to fight legislation banning the platform from US app stores. The algorithms TikTok uses are deemed core to ByteDance’s operations, making a sale of the app with algorithms highly unlikely. Despite TikTok’s popularity, it operates at a loss and accounts for a small share of ByteDance’s total revenues and daily active users. A shutdown would have a limited impact on ByteDance’s business, while the company would not have to give up its core algorithm. ByteDance has no plan to sell TikTok and is exploring scenarios for selling TikTok’s US business without the algorithm that recommends videos to TikTok users. TikTok’s CEO, Shou Zi Chew, expects to win a legal challenge to block legislation signed into law by Joe Biden that would ban its popular short video app used by 170 million Americans. The bill sets a January 19 deadline for a sale, but Biden could extend the deadline by three months if he determines that privately owned ByteDance is making progress. The US accounted for about 25% of TikTok’s overall revenues last year.
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