A possible solution for TikTok ban: American investors may buy the Chinese app
At the beginning of July, the American Secretary of State Mike Pompeo shocked many people by claiming the United States is considering the ban of many Chinese apps, including TikTok. This ban would be caused by reports suggesting that China was using viral social media apps to data farm, stealing the personal information of many US citizens.
However, new reports show that there are many US-based companies interested in buying this successful Chinese app. According to The Financial Times and The Information, these investors include Sequoia and General Atlantic, which are both responsible for huge investments in companies like Google, Youtube, and LinkedIn.
Though all three companies involved in this issue have declined to comment on this new development, many people are confident it can be the solution to the imminent ban. If an American company manages to buy the app and have control over it, the government will probably agree to keep the platform.
It is important to mention that any app gathers user data, and there hasn’t been any proof that TikTok is data farming more than Facebook, for example. The problem with the platform, that caused Mike Pompeo to declare it a “danger to Nacional Security” is the fact that user information is going directly to China.
How much is TikTok worth?
This social media app is very popular in the US, especially among teenagers. According to the Business of Apps, up to 49% of teenagers have TikTok downloaded on their phones, so it’s safe to say that this platform is very profitable.
ByteDance – which is the company that owns TikTok – has made a private evaluation of 110 billion USD, but one analyst who spoke to Bloomberg has analyzed the companies statistics and speculated that the real value could be up to 180 billion USD.
The actual value of the company is not clear but in either case, ByteDance is the most valuable startup in the world. Yes, as crazy as that might seem, the company that owns one of the most popular apps in the world, is in fact a startup.
This extremely high value seems to be the reason why no company hasn’t jumped in to buy it yet, just to offer you some perspective, General Atlantic – one of the American firms interested in the app – has a value of “just” 34 billion USD, which is nowhere near enough to buy TikTok.
TikTok’s race to avoid a ban
As one can imagine, the platform’s owners are not willing to see their platform getting banned in the US, since that is where most of its audience is in the first place. So, in order to avoid being blocked, the app is adopting some safety measures.
The TikTok team has been trying to distance themselves from the Beijing headquarters for months, by claiming that their data centers are located entirely outside of China and by releasing transparency reports where they state their commitment to privacy and user safety.
They are also moving headquarters to the US, some say the goal is to move completely outside of China as a means to detach themselves from the oppressive Chinese government and their “content control” policies that are harming many social media platforms.
Another important step to restore American trust in the app was to hire executive Kevin Mayer as a CEO for the company. The American businessman left his job at Disney as a Head of Streaming to manage the Chinese app, which makes a lot of people wonder if TikTok is trying to leave its origins in the past altogether.
Though their efforts to change seem to be great, many celebrities have been deleting the app from their phones and a lot of Americans are doing the same to protect their data. Also, there is still a big chance that the government will end up blocking TikTok after all, joining Indonesia and India.
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