Bytedance Would Rather Shut Down TikTok in US than Sell It

Sources said that ByteDance, which owns TikTok, would prefer to close its app rather than sell it if the Chinese company exhausts all legal options to challenge legislation aimed at banning the platform from app stores in the United States.

Sources close to the parent company said that the algorithms that TikTok relies on in its operations are fundamental to ByteDance’s overall operations, which makes selling the application, including the algorithms, highly unlikely.

It stated that TikTok represents a small share of ByteDance's total revenues and daily active users, so the company prefers to close the application in the United States in the worst-case scenario rather than sell it to any American buyer.

The sources explained that the closure will have a limited impact on ByteDance's business while the company will not be forced to abandon its core algorithms.

It said late yesterday, in a statement published on its Toutiao media platform, that it had no plan to sell TikTok in response to a report by (The Information) website that stated that ByteDance was exploring scenarios for selling TikTok businesses in the United States without the algorithms that recommend videos. For users.

TikTok CEO Xu Ziqiu said on Wednesday that the company expects to win a legal battle to stop implementation of the law signed by President Joe Biden, which he said would ban the app used by 170 million Americans.

The law sets a deadline of January 19 for the sale of the application’s assets, that is, one day before the end of Biden’s term, but he can extend the deadline by three months if he believes that ByteDance is making progress.

A separate source familiar with the matter said that the United States represented about 25% of TikTok’s total revenues last year.

Sources reported that ByteDance’s revenues for 2023 rose to approximately $120 billion from $80 billion in 2022. One of the sources said that daily active TikTok users in the United States constitute only about 5% of ByteDance app users around the world.