TikTok has filed an emergency appeal with the U.S. Supreme Court, seeking to delay passage of a law that could impose a nationwide ban on the app unless its Chinese parent company, ByteDance, relents his property before January 19.
ByteDance has previously said it has no plans to do so.
The January 19 deadline would see TikTok removed from app stores and made inaccessible through US-based internet providers.
Background
TikTok was launched by ByteDance in 2017 as an international version of its Chinese app Douyin, which itself launched in September 2016.
The platform has since grown in popularity, becoming a hub for entertainment, viral trends and political discourse. ByteDance acquired US lip-syncing app Musical.ly in 2017 for nearly $1 billion. merging it with TikTok the following year.
In 2021, TikTok had exceeded one billion users worldwide.
Worried governments
India banned TikTok in 2020 and the European Union has raised privacy concerns.
Efforts to restrict TikTok in the United States date back to President-elect Donald Trump’s first term. In 2020, Trump issued executive orders to force the divestment of TikTok’s US operations, but these orders were challenged in court and ultimately revoked by President Joe Biden in 2021.
Under Biden, however, concerns about Chinese access to user data have persisted. On April 24, 2024, Biden signed the Protecting Americans from Apps Controlled by Foreign Adversaries Act. This legislation marked the shift from executive orders to formal congressional action. Under this law, social media services (including websites and application software) can be banned within 270 to 360 days if determined by the President of the United States and the provisions relevant as being an “application controlled by a foreign adversary”. The law explicitly applies to ByteDance and its subsidiaries, including TikTok, without the need for further determination.
TikTok challenged the law, arguing that it constituted an unconstitutional restriction on free speech. However, on December 6, 2024, the Washington DC Circuit Court of Appeals rejected TikTok’s claims. TikTok’s appeal to the Supreme Court follows this ruling, with content creators also filing a parallel appeal.
What’s the problem?
There are three main concerns:
- Data confidentiality. Critics say TikTok collects excessive amounts of user data, such as location, browsing history and biometric data. While TikTok says its data collection meets industry standards, some cybersecurity analysts believe the information could be accessible to the Chinese government under China’s 2017 National Intelligence Law, which requires Chinese companies to support government intelligence activities upon request.
- National security. U.S. officials have long feared that TikTok could serve as a conduit for Chinese espionage or influence operations. Former President Trump’s executive orders stated that TikTok’s data collection could be used for surveillance, blackmail or espionage. TikTok’s “Project Texas” initiative aimed to address these fears, by storing US data on Oracle servers in Texas.
- Content manipulation and disinformation. Critics say TikTok’s recommendation algorithm could be exploited for influence. FBI Director Christopher Wray has warned that the Chinese government could use TikTok’s algorithm to manipulate content seen by Americans.
Some experts say these risks remain “theoretical” rather than proven. Notably, a survey conducted by the Georgia Institute of Technology found that TikTok’s data collection is similar to that of other social media platforms. However, evidence that ByteDance employees inappropriately accessed user data in December 2022 has triggered new alarms.
Market implications
ByteDance itself is a private company. But a ban could have several effects.
The “winners” from a ban would be Meta, Snap and Google. If TikTok’s 170 million U.S. users are forced off the platform, other social media platforms could gain new users and advertising revenue. Meta’s Instagram Reels and YouTube Shorts could see an increase in user engagement.
“Losers” would include ByteDance and private equity investors. ByteDance’s valuation, which some estimate at more than $200 billion, could see a sharp decline. Sequoia Capital and SoftBank could see their stakes lose value, particularly if TikTok is sold under pressure at a discount.
Content creators benefiting from advertising or direct benefits (via the TikTok Creator Rewards program) would obviously be impacted.
The ban could also signal increased regulatory pressure on other Chinese apps and technology companies operating in the United States, such as Alibaba and Tencent, and could prompt U.S. allies to follow suit with their own legislative action.
What’s next?
In its appeal, TikTok argues that the Protecting Americans from Apps Controlled by Foreign Adversaries Act violates the First Amendment rights of the company and its 170 million U.S. users. The company is asking the Supreme Court to block the law until it has a chance to review constitutional claims on its regular docket. The case now goes before Chief Justice John Roberts, who can decide on his own or send it back to the full court for a vote.
If the Supreme Court rejects TikTok’s appeal or refuses to hear the case, the January 19 deadline will remain in effect. President Biden has the option to grant TikTok a 90-day extension if ByteDance shows “significant progress” toward divestment, but there is no indication he will do so.
TikTok has requested a ruling by Jan. 6 to give app stores and internet providers time to comply if the law takes effect.
Trump has also spoken out on the issue, expressing support for TikTok, despite attempting to ban it himself. “I have a tenderness in my heart for TikTok,” he said during a press conference, hinting at a possible intervention once he takes office on January 20.
