ByteDance, the parent company of TikTok, is considering shutting down the app in the US instead of selling it, according to four sources familiar with the matter, Reuters report.
This decision comes amidst legal challenges following legislation aimed at banning the platform from US app stores.
The bill, signed into law by US President Joe Biden, mandates ByteDance to sell TikTok within nine months or face a ban from the US, due to concerns about user data sharing with the Chinese government.
Despite TikTok’s relatively small contribution to ByteDance’s income and daily active users, the company reportedly prefers blocking the app in the US rather than selling it to an American buyer.
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The sources, requesting anonymity, mentioned that even if ByteDance were to shut down, its core algorithm would remain intact, with minimal impact on revenue.
ByteDance declined to comment, but clarified on Toutiao that there are no plans to sell TikTok. TikTok’s CEO expressed confidence in overcoming legal challenges, with the platform currently boasting 170 million American users and the US contributing approximately 25% of its total revenues last year.
The TikTok algorithm, crucial for its operations, is seen as a major obstacle to any potential sale, as it’s considered a valuable asset and a national security concern by critics in the US.
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