TMTPOST -- TikTok has warned that a ban on its platform in the United States could result in a $1.3 billion loss in revenue and earnings for small businesses and social media creators within just one month in a court filing earlier this month. The potential ban, set to take effect on January 19, stems from a law addressing national security concerns related to ByteDance, TikTok’s China-based parent company.
“These losses would grow significantly if the shutdown lasts beyond one month,” noted Blake Chandlee, TikTok’s president of global business solutions, in the filing.
Chandlee’s statement was part of TikTok’s request for a federal appeals court to temporarily block the law. The law would compel app stores run by Apple and Google, as well as internet service providers, to remove TikTok unless ByteDance sells the app.
TikTok and ByteDance also plan to appeal the case to the U.S. Supreme Court, seeking to overturn a recent ruling by the U.S. Court of Appeals for the District of Columbia Circuit that upheld the legislation.
“The Supreme Court, as the only court with appellate jurisdiction in this matter, should have the opportunity to review this critically significant case,” TikTok and ByteDance argued in their filing, requesting a temporary injunction.
If approved, the injunction would allow TikTok to remain operational while the Supreme Court decides whether to hear the case.
The filing emphasized that an injunction is particularly important as it would provide the incoming administration of President-elect Donald Trump, who will take office on January 20, with the option to determine whether to enforce the law.
Chandlee also highlighted the economic fallout of a potential shutdown, saying that U.S. small businesses could lose over $1 billion in revenue even if the ban is lifted after a month. Additionally, nearly two million U.S. creators would collectively lose around $300 million in earnings, while TikTok would forfeit 29% of its projected global advertising revenue for 2025.
As of November 2024, more than 7 million U.S.-based accounts use TikTok for business, according to Chandlee. An economic report by Oxford Economics, cited in the filing, found that 69% of these businesses reported increased sales through TikTok, with 39% considering the platform essential to their operations.
The report also revealed that in 2023, TikTok’s business ecosystem contributed $24.2 billion to the U.S. GDP, with TikTok’s own operations adding another $8.5 billion.
The law under scrutiny was passed by Congress and signed by U.S. President Joe Biden last spring amid concerns over ByteDance’s alleged ties to the Chinese government.
Last Friday, the D.C. Circuit Court of Appeals rejected ByteDance’s argument that the law infringes on the First Amendment rights of TikTok’s 170 million U.S. users or violates other constitutional protections.
In its ruling, the court found that the U.S. government presented “compelling evidence” showing that the law was narrowly designed to safeguard national security.
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