Legislation that could ban Tiktok in the U. S. revived
WASHINGTON » Legislation that could ban Tiktok in the U. S. if its China- based owner doesn’t sell its stake won a major boost late Wednesday when House Republican leaders included it in a package of bills that would send aid to Ukraine and Israel. The bill could be law as soon as next week if Congress moves quickly.
The Tiktok legislation, which passed the House in March and has widespread support in both chambers, was included in the House package as leaders have worked to win votes for the foreign a id b ills a nd a fter negotiations w ith the Senate o ver how long the Chinese technology firm Bytedance Ltd. would have to sell its stake for the app to c ontinue operating in t he United States.
President Joe Biden has said he would sign the Tiktok legislation if it reaches his desk.
The new version of the legislation won a key endorsement from S enate Commerce C ommittee C hairwoman Maria Cantwell, who said in a statement that she had successfully pushed to extend t he period from s ix months to a y ear to give the company enough time to find a buyer.
While the original bill had a six- month deadline for Tiktok to be sold, the revised legislation would give nine months and a possible three- month extension if a sale was in progress.
“Extending the divestment period i s necessary to e nsure there is enough time for a new buyer to get a deal done,” said Cantwell, who had previously expressed doubts about the bill. “I support this updated legislation.”
If C ongress passes t he T ikTok bill, it would be an extraordinary and unusual moment in which both parties unite against one company — something lawmakers are usually reluctant to do. But the popular social media app has prompted w idespread outrage on Capitol Hill, where there is bipartisan concern about C hinese t hreats t o the United S tates and where few members use the platform themselves.
Opponents say they b elieve the ban would be u nconstitutional, and there would be likely court challenges i f it p asses. There has been aggressive pushback from the company, content creators who make money on the app and some of the platform’s 1 70 m illion U. S. users, many of whom are young.
In s ome cases, l awmakers have r eceived profanity- laced calls from u sers w ho w ere prompted by the app to c all their representatives in C ongress.
To date, the U. S. government has not provided evidence that shows Tiktok shared U. S. user data with the Chinese government, or that Chinese authorities have tinkered with the company’s popular algorithm, which influences what Americans see.
Since mid- March, Tiktok has spent $ 5 million on TV ads opposing the legislation, according to Adimpact, a n advertising tracking firm. The ads have included a range of content creators, including a nun, extolling the positive impacts of the platform on their lives and arguing a ban would trample on the First Amendment.
Tiktok has also spent money on F acebook and Instagram ads that, among other t hings, talk about investments in data safety.
In addition, the company has mounted a lobbying campaign in Washington that included flying in content creators who rely on the platform for income.
Alex Haurek, a spokesman for the company, said in a statement Thursday that “It is unfortunate that the House of Representatives is using the cover of important foreign and humanitarian assistance to once again jam through a ban bill that would trample the free speech rights of 170 million Americans, devastate 7 million businesses, and shutter a platform that contributes $ 24 billion to the U. S. economy, annually.”
Nadya Okamoto, a content creator who has roughly four m illion f ollowers o n Tiktok, said she’s been having conversations with other creators who are experiencing “so much anger and anxiety” about the bill and how it’s going to impact their lives.
The 26- year- old, whose company “August” s ells menstrual products a nd is known for her advocacy around d estigmatizing menstrual periods, makes most of her income f rom Tiktok.
“This is g oing to have real repercussions,” s he said.
Dan Ives, a tech a nalyst at the financial advisory firm Wedbush Securities, said such a sale would be very complex to c arry out, even with an extended timeline.
The platform w ould come with a hefty price tag that only the biggest tech companies could afford, something that’s likely to raise antitrust concerns. Then, there’s the issue of Tiktok’s a lgorithm, the app’s secret sauce that recommends videos to users.
The bill bars Bytedance from controlling Tiktok’s algorithm, and a potential sale is likely to face opposition f rom China, which has been c lamping down on exports of recommendation algorithms by Chinese
tech companies.
“Buying Tiktok without the algorithm would be like buying a Ferrari without the engine,” said Ives.
Some investors, including former Treasury Secretary Steven Mnuchin and “Shark Tank” s tar K evin O’leary, h ave already voiced i nterest in buying Tiktok’s U. S. business. If a sale isn’t approved and the platform d oes get banned, Ives said it would be a “dream scenario” for Snapchat, Meta and YouTube, which have f aced stiff competition from TikTok the past few years.
If the bill does pass, i t would be the most significant step C ongress has taken in d ecades t o regulate the tech industry. For years Congress h as failed to act on legislation that would protect users’ privacy, p rotect c hildren online, make c ompanies more liable for their content and put loose guardrails around artificial intelligence, among other things.
Still, it is a narrow shot at o ne c ompany w hen many l awmakers w ould like to see broader change.
Democratic S en. Mark Warner o f Virginia, the chairman o f the Senate Intelligence C ommittee, has been pushing for years for tech regulation. If the Tiktok bill passes, he said, “it will be the first guardrail w e put on a nything on s ocial media.” Warner said there are a lot of other things that Congress representing 2,400 consumer packaged b rands, according to a prospectus filed with the U. S. Securities a nd E xchange Commission.
Walmart, Family Dollar and Kroger are some of the large retailers that use the company’s AI- driven software t o provide promotions based on customers’ anticipated purchasing behavior.
The mobile s hopping app in 2019 became Denver’s needs to d o, “but you’ve got to start someplace.”
While most lawmakers support the Tiktok b ill, some h ave said i t would set a dangerous precedent.
“The p assage o f the House Tiktok ban i s not just a m isguided o verreach; i t’s a draconian measure that s tifles f ree expression, tramples constitutional rights, and disrupts the economic p ursuits of millions of Americans,” Kentucky Sen. Rand Paul posted on X after the House passed it.
Others a re d efending the app’s loyal users.
“I am a NO on the TikTok bill w e are about to vote on,” Florida Rep. Maxwell Frost posted on X before t he H ouse v ote. A t 27, Frost is much younger than m ost of h is c olleagues.
“I b elieve t he b ill does s et T iktok up t o be b anned,” Frost said. “There a re F irst A mendment issues I see with taking away a platform that over 1 70 m illion A mericans use, and this won’t fix the serious issues we have with data privacy.”
Jenna Leventoff, a lawyer for the American Civil Liberties Union, previewed potential First Amendment challenges to the bill.
“Congress cannot t ake away t he r ights of o ver 170 million Americans who use Tiktok to express themselves, engage in political advocacy, and access information from around the world,” she said.
only “unicorn” or tech start- up worth more than $ 1 billion.
Leach said h e became emotional standing above the floor of the NYSE ringing the opening bell. He could see the faces of his children a nd I botta supporters looking up at him and recalled the days when he launched the company from his living room.
“You can feel the weight of everyone’s achievement,” he said.