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US’s ban on TikTok means a $1.3 billion loss to small businesses in one month

US's ban on TikTok means a $1.3 billion loss to small businesses in one month

The US’s imminent ban on TikTok has engendered frantic warnings by the social media company of economic consequences. In a court filing on Monday, TikTok contended that American small businesses and creators could lose as much as $1.3 billion in just one month should the app be shut down on January 19. This comes amid a law targeting national security concerns linked to TikTok’s Chinese parent company, ByteDance.

Blake Chandlee, TikTok’s president of global business solutions, emphasized that the impact will be exponential should the ban extend beyond a month. He added that shutting down the app would directly hurt the app’s nearly two million creators and over 7 million businesses in the U.S., for whom TikTok is a source of critical revenue. The TikTok ban could also cost itself nearly 30% of its projected global ad revenue for the year 2025 as a result.

Companies file appeal to remove ban on TikTok

TikTok and ByteDance have filed an appeal, asking a federal court to block the enforcement of the law. The app is also preparing to take the case to the Supreme Court. They say that such an injunction is crucial for them to continue their operations while the Court decides upon whether to hear the appeal or not. TikTok also adds that the ban would deprive U.S. creators and businesses of essential tools for growth and innovation.

Economic reports commissioned by TikTok illustrate the importance of the service to the U.S. economy. In 2023, TikTok’s ad and business activity added $24.2 billion to U.S. gross domestic product, while another $8.5 billion resulted from the company’s operations. Enterprises who utilize the app reported a jump in sales and improved marketing, with many claiming TikTok as integral to their survival.

The debate over the TikTok ban in the US reflects broader concerns about balancing national security with economic and social impacts. For now, the fate of the platform-and its millions of users-rests with the courts, and perhaps the incoming administration.

Also, see: Open AI unveils generative AI video tool Sora

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I'm Ved Prakash, Founder & Editor @Newsblare Media, specialised in Business and Finance niches who writes content for reputed publication such as Investing.com, Stockhouse.com, Motley Fool Singapore, etc. I'm the contributor of different... news sites that have widened my views on the current happenings in the world.

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