Potential TikTok ban threatens US business of China's cross-border sellers

The US is forcing ByteDance to divest TikTok or face a ban, upending the future businesses of Chinese merchants on TikTok Shop.

TikTok Shop is the e-commerce service of the globally popular short-video app owned by Beijing-based ByteDance. “It’s not the time for newcomers to enter the US,” said Hong Ming, co-founder of the Shenzhen-based TikTok Seller Alliance. TikTok has been banned in other places in the world before. India has blocked the app for the past four years, after a deadly clash on its Himalayan border with China. But leaving the US would be far more devastating for the app and China’s technology ambitions.

An attempt in 2020 by ByteDance to sell a minority stake in TikTok to US investors was criticised at home as “kneeling down” to Washington, leading the company to issue a lengthy Chinese-language statement clarifying that TikTok Global would remain its wholly-owned subsidiary.“It will definitely be damaging to see go away,” said Noah Jay Wood, who has 7 million followers on the platform. He said TikTok has better algorithms.

“It’s risky to rely solely on one platform due to the ever-changing algorithms that affect how creators reach their audience,” he said. What is more, if TikTok is banned, creators and merchants “could face financial difficulties while trying to establish new revenue streams”.Despite its broad popularity, TikTok is under intense competitive pressure.

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