TikTok Ban Law to Take Effect on the 19th...
Supreme Court Reviews Constitutionality
US Creators and Marketers Closely Monitor and Prepare for the Situation
With the TikTok ban law set to take effect in the United States on the 19th, creators and marketers are busy preparing. Although President-elect Donald Trump has requested the court to postpone the enforcement date until after his inauguration, it remains uncertain whether this will be accepted. Concerns are pouring in about the ripple effects if TikTok, which has created a market worth hundreds of trillions of won in the U.S., actually ceases operations.
The New York Times (NYT) recently reported on the movements of TikTok creators, stating, "Even they are not sure if the real TikTok will shut down its business in the U.S. within this month." TikTok is a social networking service (SNS) platform known for sharing short and impactful videos, enjoying great popularity. The monthly active users (MAU) in the U.S. reach 170 million. Goldman Sachs has projected that the creator industry formed by TikTok could reach $480 billion (approximately 700 trillion won) by 2027.
The TikTok ban law originated from concerns in U.S. political circles that information of American TikTok users could flow to the Chinese government, posing a national security threat. In April last year, the U.S. Congress passed this law, which prohibits TikTok's parent company, the Chinese firm ByteDance, from operating in the U.S. if it does not sell its U.S. business rights within 270 days. Accordingly, TikTok faces the crisis of having to sell its U.S. business or cease operations by the 19th.
The biggest impact of the TikTok ban law is expected to be on TikTok creators in the U.S. Since TikTok gained huge popularity in the U.S. during the 2020s, the number of creators who quit regular jobs to produce TikTok content and make a living from it has rapidly increased. Joe Mel, a 26-year-old TikTok star from Long Island, said, "I recently reached 30 million followers, but I might lose everything in ten days," expressing his fear.
In response, creators are asking their followers to subscribe to other competing platforms such as Instagram Reels or YouTube Shorts. They are also investing more time in producing content in formats other than TikTok, and some have created pages requesting followers to provide their email addresses and phone numbers to build follower lists.
Marketing Industry Also Considering Shift from TikTok to Instagram and YouTube
The marketing industry, which actively utilized TikTok channels, is reportedly reviewing plans to redirect billions of dollars in advertising budgets to platforms like Instagram and YouTube. They are taking measures such as moving existing TikTok advertisements to other channels like Instagram and YouTube. Craig Brommers, Chief Marketing Officer (CMO) of American Eagle Outfitters, a U.S. retailer, described this as "the biggest headline event in marketing history and the most significant system shock in the past decade."
However, both creators and marketers are closely monitoring the situation as it remains unclear whether TikTok will actually cease operations on the 19th. President-elect Trump submitted a brief to the federal Supreme Court last month requesting a suspension of the TikTok ban law enforcement, asking for the deadline for the company sale to be postponed until after his inauguration. The Supreme Court is scheduled to begin hearing the appeal trial on the 10th, with TikTok arguing that the law infringes on freedom of expression. The Associated Press explained, "It is unclear how quickly the Supreme Court will issue a ruling," adding, "If at least five of the nine justices find the law unconstitutional, they can immediately block its enforcement."
Earlier this month, there was also speculation that Elon Musk, CEO of Tesla, might form a consortium to acquire TikTok. ByteDance has stated that it currently has no intention to sell the company, and there are concerns that the company’s valuation is too high for acquisition. However, IT media The Information projected, "If the deadline approaches and the service must be terminated, their stance might change," suggesting that Musk, who owns the social media platform X (formerly Twitter), could step in.
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