Marketplace®

Daily business news and economic stories

TikTok gets more time

The company has 90 more days to come up with some kind of deal to avoid getting banned from U.S. app stores.

Download
TikTok gets more time
Drew Angerer/Getty Images

It’s yet another reprieve for TikTok: The company has 90 more days to come up with some kind of deal.

This is in response to the bipartisan law that was supposed to kick in in January that would have required the app’s Chinese owner, ByteDance, to sell TikTok to an American company or be banned from U.S. app stores. But the Donald Trump administration delayed the law's implementation for a third time this week.

All of this back and forth started in 2019 when national security experts and members of Congress starting raising the alarm that Chinese-owned TikTok having so much data and influence on Americans was a major threat. Back then, the first Trump administration seemed to agree.

But now? “It's kind of a shift in terms of the first administration, where we saw much more of this kind of national security focus and more on kind of, like practical commercial-based considerations,” said Kenton Thibaut, senior resident China fellow at the Atlantic Council.

TikTok isn’t just popular — with a third of U.S. adults using the app — but it’s also the way a lot of businesses and people make money.

“It's much, much easier on TikTok to monetize your content. Influencers get paid a lot more,” Thibaut said. “And so TikTok users have been kind of loyal to the app.”

When President Joe Biden signed the bipartisan law that was supposed to force the sale or banning of TikTok, it did spook the market a bit.

“There was a chapter there where brands just weren't willing to invest as much capital in their TikTok initiatives,” said Dillon Smith, CEO of TeamChecked, a celebrity influencer and brand management firm. “But after the first extension and then the second extension, I think everyone's fear was calmed there, and we've seen just as much investments and onboarding of new brands as we did at its prime.”

Now, Smith said no one actually thinks TikTok is really going to get banned, so they are just waiting to see what a deal will look like.

In the meantime, TikTok’s parent company, ByteDance has been busy in Washington, increasing the amount it spent on lobbying from $270,000 in 2019 to more than $10 million last year.

And so far this year? “This first quarter is $3.36 million, and so this is a sharp increase. It's the biggest Q1 spend by ByteDance,” said Hilary Braseth, executive director of OpenSecrets, which tracks money in politics and compiled the data on ByteDance’s lobbying efforts.

“This is a clear effort to try to engage officials at many levels of government, to try to maintain the position they have, which is to be able to remain owned by the same owners and also able to operate in the way that they've been operating,” she added.

So far, those efforts seem to be working.

Related Topics

Latest Episodes

View All Shows
  • Marketplace
    a day ago
    26:11
  • Make Me Smart
    2 days ago
    28:43
  • Marketplace Morning Report
    2 days ago
    6:58
  • Marketplace Tech
    2 days ago
    12:22
  • Million Bazillion
    5 days ago
    5:01
  • This Is Uncomfortable
    a month ago
    2:27
  • Financially Inclined
    2 months ago
    12:30
  • How We Survive
    2 months ago
    22:09
  • The Uncertain Hour
    4 months ago
    22:50
  • Corner Office from Marketplace
    5 years ago
    20:58
OSZAR »