Biden Backs Senate Bill That Could Spell Doom for TikTok

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The Gist

US wants TikTok sale? The Biden administration is reportedly demanding TikTok’s Chinese owners, Bytedance, sell its stake in the company or face a possible ban of the app in the US due to national security concerns.
Potential Congressionally-backed TikTok ban. President Biden recently announced support for a Senate bill that could lead to a total TikTok ban in the US, and a group of bipartisan senators introduced the RESTRICT Act that would grant the administration new powers to regulate and block foreign-owned apps they deem a risk to national security, including TikTok.

Marketers: What’s your plan?With uncertainty surrounding TikTok’s future, some brands have pulled back on their marketing efforts on the platform and are exploring alternative platforms. The various government and organizational bans on TikTok have had a significant impact on the platform’s marketing ecosystem, leading some marketers to struggle to find alternative channels that offer the same level of reach and engagement.

Marketers thinking about expanding its presence on TikTok take notice: Time may be running out for TikTok as US President Joseph Biden threatens a total US ban on the popular social media app.

According to NBC News, a source close to Tiktok confirmed that the Biden administration is demanding the company’s Chinese owners, Bytedance, sell its stake in the social media giant or face a possible ban of the app here in the US. The fear is that China could use the app to access the data of American citizens, particularly because of national security law there that requires companies to turn over customer data if requested.

For its part, TikTok denies the allegations, saying that “if protecting national security is the objective, divestment doesn’t solve the problem, because a change in ownership would not impose any new restrictions on data flows or access.”

US Already Not Sold on TikTok

The news comes on the heels of President Biden’s recently announced support for a Senate bill that could also potentially lead to a total TikTok ban in the US. And we know full well the US-China relationship when it comes to data and surveillance hasn’t been all warm and cozy lately.

On March 7, US Senator Mark R. Warner of Virginia and Senator John Thune of South Dakota led a group of 12 bipartisan senators to introduce the Restricting the Emergence of Security Threats that Risk Information and Communications Technology (RESTRICT) Act, that, if passed, would grant the administration new powers to regulate and block foreign-owned apps they deem as a risk to national security, including TikTok.

“Today, the threat that everyone is talking about is TikTok, and how it could enable surveillance by the Chinese Communist Party or facilitate the spread of malign influence campaigns in the US,” Warner said in a statement. “We need a comprehensive, risk-based approach that proactively tackles sources of potentially dangerous technology before they gain a foothold in America, so we aren’t playing Whac-A-Mole and scrambling to catch up once they’re already ubiquitous.”

TikTok: A Timeline of US Interventions

Biden’s most recent move is a welcome one for a number of politicians in Washington, who have voiced apprehension regarding what they perceive as Biden’s sluggishness in addressing the TikTok matter.

In early February, Biden said he wasn’t sure if Washington would ban TikTok. “I’m not sure. I know I don’t have it on my phone,” Biden said, responding to a reporter’s question.

Imbued with the power to block foreign investments in US companies, the Committee on Foreign Investment in the United States (CFIUS) began an inquiry into Tik Tok in 2019, citing concerns over national security. Given China’s ever-increasing investment in American industries, CFIUS has rejected several high-profile deals over the years.

But many are frustrated that their investigation into TikTok is still ongoing.

According to the non-profit watchdog organization Public Citizen, Chinese financial entities own assets worth more than $120 billion in the US economy.

In August 2020 President Trump issued executive orders to prohibit transactions with ByteDance, TikTok’s Chinese parent company — and demanded the company relinquish ownership of TikTok’s US operations to an American entity. However, Trump left office before the deal could be finalized.

In December 2022, President Biden signed The No TikTok on Government Devices Act into federal law, prohibiting the use of TikTok on all federal government devices. Other countries that have instituted partial or total TikTok bans include India, Taiwan, Canada, Belgium, the European Union, Pakistan and Afghanistan. And across Alabama, Arkansas, Mississippi, Montano, Oklahoma and Texas, 26 colleges have already banned TikTok.

It’s the latest in a multi-year struggle to regulate (or obliterate) the social media app. But with more than 1 billion active users, adding new stringent regulations — or enacting an outright ban on TikTok, could have a significant impact on marketers who rely on the platform to reach audiences and build brand awareness.

Related Article: What You Need to Know About Marketing on TikTok

Brands Evaluate TikTok Marketing Efforts Amid Uncertainty

So what does this all mean for marketing and customer experience efforts? Uncertainty has led some brands to pull back on their TikTok marketing efforts and explore alternative platforms. The various government and organizational bans on TikTok have had a major impact on the platform’s marketing ecosystem. Brands relying on TikTok to reach audiences in those countries had to quickly pivot to other platforms, and some marketers struggle to find alternative channels that offer the same level of reach and engagement.

While TikTok remains available in many countries, the uncertainty and disruption caused by the bans could lead some brands to question whether the risks of investing in the platform were worth it.

“I’m thinking that TikTok is going to be banned entirely sometime in 2023 and will no longer exist as a platform, or at the very least TikTok may be heavily regulated,” said John Frigo, commerce manager at Bestpricenutrition.com.

Logan Mallory, VP of marketing at Motivosity, is taking the wait and see approach — but also planning for the possibilities.

“For now, it’s best for companies to continue to execute their TikTok marketing strategies as planned while also looking for alternatives so that they can be prepared if the ban on TikTok becomes more widespread. This gives companies time to formulate a new marketing plan while still taking full advantage of their TikTok strategy while it’s still a viable option,” Mallory said. “There’s always been a lot of talk about restricting access to TikTok or banning it entirely in the US, but until that happens it remains a very useful channel for companies to invest in.”

Berry Moise, the founder of BerryMo.com, said the new legislation surrounding TikTok has created a lot of uncertainty for marketers, making it essential to develop a strategy that considers the potential changes. For Moise, his strategy includes staying up to date on the latest news and developments about the legislation and identifying alternative platforms.

“Content is still vital, so make sure to create content that will engage your target audience regardless of the platform,” Moise said. “As the situation evolves, it is important to test different methods to find out what works best. Your strategy should be flexible enough to adapt as the situation changes.”

Diversify Your Online Marketing Presence

Sarah Walsh is a strategist at the digital marketing agency, Branch & Bramble, who specializes in audience-focused social media strategies with an emphasis on TikTok and Instagram. She says the proposed legislation only further proves the volatility of social media and the necessity of having an owned online footprint.

“We are recommending to our clients to prioritize diversifying their online presence. Now is the time to make sure your website is performing at its best and your email subscriber list is continuing to grow,” Walsh said. “Our clients have greater success during challenging current events or economic downturns when they have multiple marketing channels running smoothly.”

As for Doug Campbell, president of Colling Media, he has no plans to discontinue his TikTok strategy — at the moment.

“So long as consumers are continuing to use TikTok, it will remain an important part of our overall marketing mix, particularly when attempting to reach younger demographics,” Campbell said. “Since most of the audience on TikTok is younger, the ban on government devices is unlikely to cause any substantial decrease in the number of 18-24 years olds using the platform. Obviously, we will continue to monitor the performance of campaigns on TikTok, and if any further government actions lead to a dip in performance, we would recommend a shift to other social platforms that occupy a similar place in the consumer’s lifestyle, such as Instagram Reels or the up-and-coming YouTube Shorts.”

Related Article: How TikTok Is Changing the Digital Marketing Game

What’s Next: TikTok CEO Faces Congress Amid Allegations

TikTok CEO Shou Zi Chew is set to appear before Congress on March 23 where he will certainly face tough questions related to allegations of sharing US users’ data with China and using the app for propaganda or manipulation. Bytedance, the social media company that owns TikTok, has consistently denied sharing user data with the Chinese government or storing data in China. The company also refutes claims that it collects more user data than other platforms, emphasizing that it operates independently with its own management team.

Foreign Ministry Spokesperson Mao Ning addressed the controversy during a press conference last month.

“How unsure of itself can the world’s top superpower be to fear a young people’s favorite app like that? The US has been over-stretching the concept of national security and abusing state power to suppress foreign companies,” Ning said. “We firmly oppose those wrong actions. The US government should respect the principles of market economy and fair competition, stop suppressing the companies and provide an open, fair and non-discriminatory environment for foreign companies in the U.S.”