(CapitalWatch, Dec. 7, New York) Trump had failed to ban TikTok in the U.S. back in 2020, but the widely popular app is now under threat again. Several states have already limited the use of the Chinese app, and several others are considering similar action on the grounds of national security.
First, it was Nebraska in 2020; suddenly, South Dakota banned the use of TikTok from government devices last week. This week, it was South Carolina, Arkansas, Maryland, and Texas that raised the issue so far. One-by-one, U.S. officials are voicing concerns over data security on the smartphones of state agencies and ordering to block the video-sharing app operated by the Beijing-based ByteDance.
Two years ago, when the Trump administration attempted to ban TikTok along with another mass-used Chinese app WeChat, it failed to prove its case in the court. Federal judge Carl Nichols of the U.S. District Court for the District of Columbia requested evidence that TikTok shares user data with Beijing – of which there was none. WeChat got a similar court ruling.
An option for TikTok to keep its American users was to spin off its U.S. business and sell the majority stake to a U.S. company. But the sale talks with Oracle (NYSE: ORCL) and Walmart (Nasdaq: WMT) dissolved after Joe Biden took presidency in early 2021. Biden said he would review the ban on Chinese apps, as he would the hiked China tariffs – and dropped it soon after.
Since, the Biden administration and ByteDance have been discussing the terms under which TikTok could separate its U.S. operations and sever its Beijing ties. Oracle is still in – it would store U.S. user data on its servers, according to various reports.
The deal was expected to occur by the year-end, but now, as The Wall Street Journal reported, some issues have surfaced like selective video viewing and concerns over consumer influence that have delayed an agreement.
According to a November report by Wallaroo, TikTok counted about 80 million monthly active users in the United States. Worldwide, the chart-topping video app counted nearly 1 billion monthly users even after its ban in India, where it was massively popular.