TikTok Shop hit $100M in sales on Black Friday this year. Americans viewed over 30,000 TikTok shopping livestreams that day, with one creator picking up $2M in sales from a single session. Throughout the entire BFCM weekend, the platform saw a 165% increase in shoppers year over year, with a third of all purchases made going to small and medium-sized businesses.
Fast Company reports that Americans are turning to TikTok's creator rewards program to crowdfund medical bills, using TikTok payouts of $1 per 1,000 views to raise money for treatment costs.
TikTok is aware of the impact its platform is having on crowdfunding, and actually just launched an updated Donation feature to make it easier for users to raise donations for organizations directly within its app.
However none of that might matter soon…
A three-judge panel in Washington, D.C. unanimously upheld the new US law last week that will require TikTok to divest to an American owned company or face a ban, ruling that the law did not violate free speech protections under the First Amendment. The decision leaves the Supreme Court as TikTok's last hope for stopping the law from taking effect.
Eric Goldman of Technology & Marketing Law Blog wrote:
“The decision will be appealed to the U.S. Supreme Court, with uncertain prospects, so this is probably not the final word on the matter–or possibly even an important one.”
“Still, it’s a troubling ruling as a standalone microcosm of how judges’ attitudes towards censorship and free speech are flexible. And my students still are in denial that TikTok would actually be banned…despite the multi-year efforts of two presidents and Congress to do exactly that, plus now the endorsement of a unanimous DC Circuit appellate panel. Millions of Americans are in for quite a shock if the ban sticks.”
Goldman noted that the judges acknowledged that the divest-or-ban requirement is censorship, but upheld the law anyway, and that the question becomes whether the censorship can be excused due to concerns that the Chinese government might exert control over the American population through its algorithm.
However the US Government acknowledged through the court proceedings that it “lacks specific intelligence that shows the PRC has in the past or is now coercing TikTok into manipulating content from the United States.”
So now we just ban apps for NOT breaking any laws?
Goldman really hit the nail on the head with this statement: “if we are worried about Chinese authoritarianism, the correct response isn’t to expand our own authoritarianism. The solution is to embrace our core values more dearly.”
Donald Trump to the rescue?
TikTok will seek a Supreme Court injunction to hold off the current January deadline, pushing the matter into Trump's administration — but will that matter?
Dave Lee of Bloomberg wrote, “The wild card is Trump himself, whose views on TikTok have been characteristically inconsistent. His current state of mind over a ban is unclear. I know this much: taking him at his most recent word would be foolish.”
In August 2020, Trump signed an executive order forcing TikTok's divestiture within 45 days, but by 2024, Trump had done a complete 180 and said he would never ban the app.
Trump told CNBC: “There’s a lot of good and there’s a lot of bad with TikTok, but the thing I don’t like is that without TikTok, you’re going to make Facebook bigger, and I consider Facebook to be an enemy of the people, along with a lot of the media.”
However flash forward post-election and Trump is having Thanksgiving dinner with Mark Zuckerberg, while Elon Musk was his campaign's biggest donor — both who would benefit immensely from a TikTok ban.
So the reality is, we have no idea what Trump will do or not do. Plus, even if he truly is ‘anti-TikTok ban', it's not like he can just wave a magic wand and reverse a Supreme Court decision if they were to uphold the law as well.
What's next?
Today (Dec 9th), ByteDance and TikTok filed an emergency motion with the US Court of Appeals for the District of Columbia, requesting a temporary halt to the law's enforcement pending Supreme Court review. They argued that without this stay, the law would “shut down TikTok—one of the nation's most popular speech platforms—for its more than 170 million domestic monthly users on the eve of a presidential inauguration.”
The timeline for the Supreme Court to decide whether to hear the case remains uncertain. If the Court agrees to take up the case, it could issue a stay on the law's enforcement until a final decision is made. However, if the Court declines to hear the case or does not issue a stay, the January 19, 2025, deadline would remain in effect, potentially leading to a US ban on TikTok if ByteDance does not divest its ownership.
Project Liberty, founded by billionaire Frank McCourt, has pulled together participants for a consortium of investors interested in pursuing a “peoples bid” for TikTok, but they aren't the only ones itching to buy TikTok. Granted, TikTok said it would never sell — which would normally drive up the price if they company didn't have its back against a legal brick wall.