FAQ on the US TikTok Ban: What Businesses, Advertisers, and Creators Need to Know

As the US government edges closer to potentially banning TikTok, the fate of one of the most influential social platforms hangs in the balance.

This FAQ addresses the key legal, economic, and operational implications of a TikTok ban. From Trump’s legal maneuvering to advertisers' contingency plans and the platform’s role in social commerce, we break down the critical details and offer clarity on what’s at stake.

Whether you're a marketer planning your next campaign, a brand relying on TikTok Shop, or a creator wondering about the app’s future, this guide aims to answer your most pressing questions.

Legal and Political Landscape

What is the current status of the TikTok ban in the US?

• The Protecting Americans from Foreign Adversary Controlled Applications Act requires ByteDance to divest from TikTok by January 19, 2025, or face a nationwide ban.
• The US Supreme Court is set to hear arguments on January 10, 2025, to determine if the ban violates First Amendment rights.
• President-elect Donald Trump has filed an amicus brief asking the Supreme Court to delay the ban until after he assumes office on January 20, 2025, contending he could negotiate an alternative resolution.

What were the key points raised during the Supreme Court hearing on TikTok's future?

National security concerns:

• Chief Justice John Roberts emphasized ByteDance's obligations to assist Chinese intelligence under Chinese law.
• Justice Brett Kavanaugh called the government’s data collection arguments “very strong.”

Free speech implications:

• TikTok’s attorneys argued that shutting down a major speech platform is unprecedented in US history and violates the first amendment.
• Content creators testified that TikTok’s algorithm uniquely enables grassroots audience-building, making it distinct from Instagram and YouTube.

What compromise solutions were discussed during the hearing?

• Extended timelines: Legislation allows the president to grant a 90-day extension if ByteDance demonstrates progress toward divestiture.
• Alternative measures: The Court showed interest in addressing national security concerns through data security safeguards rather than full divestiture.

Separation of issues: Justices signaled support for clearer distinctions between data collection risks and content moderation practices.

Why is the TikTok ban being pursued?

• National security concerns: Lawmakers fear that Chinese national security laws could force ByteDance to share US user data with China’s government.
• Algorithm manipulation: Officials worry about the potential manipulation of public opinion through TikTok’s recommendation algorithms.
• TikTok’s response: TikTok and ByteDance deny these allegations, citing free speech protections under the First Amendment.

What happens if the Supreme Court upholds the ban?

• TikTok will be removed from Apple’s App Store and Google Play on January 19, 2025.
• Existing users will retain the app, but updates and support will cease, potentially leading to bugs and degraded performance.
• Oracle-hosted servers supporting TikTok’s US operations may also shut down, potentially disabling the app entirely.

How could Trump delay or prevent the ban when he becomes president?

• Non-Enforcement: Trump could direct the Attorney General to avoid prosecuting Apple or Google for noncompliance.
• Reinterpretation: Trump might attempt to redefine what constitutes a "qualified divestiture," potentially allowing ByteDance to retain control under revised conditions.
• Diplomatic negotiation: Trump could explore a direct deal with China to address security concerns without requiring full divestiture.

How are businesses preparing for a potential TikTok ban?

• Many small businesses are shifting to alternative platforms like Instagram Reels, YouTube Shorts, and Snapchat.
• Businesses are focusing on building email lists and customer databases for direct communication.
• Entrepreneurs are downloading and archiving their TikTok content to repurpose it across other platforms.

What impact would the ban have on small businesses and creators?

• TikTok estimates that small businesses could lose over $1 billion per month in revenues if the ban takes effect.
• Creators who rely on TikTok as their primary income source face financial uncertainty.
• While platforms like Instagram Reels and YouTube Shorts offer alternatives, creators highlight that they lack TikTok’s reach and engagement dynamics.

Impact on Advertisers

How is TikTok managing advertiser confidence amid uncertainty?

• TikTok has assured advertisers that it will refund ad spending if the app is banned on January 19. This guarantee aims to prevent an early exodus of ad budgets and maintain advertiser confidence.
• TikTok ad sales representatives have encouraged brands to increase their 2025 budgets by up to 40%, signaling the platform's commitment to preserving advertiser relationships despite looming uncertainty.
• Sameer Singh, TikTok’s North American ad chief, recently departed the company, adding an extra wrinkle of concern for advertisers already navigating the potential disruption caused by the ban.
• Major advertisers have prepared contingency plans to redirect ad budgets to Instagram Reels, YouTube Shorts, and Snapchat if a ban goes into effect.
• Some agencies, such as Tinuiti, remain optimistic that the ban might be postponed again and are continuing Q1 2025 campaigns on TikTok.

How significant are TikTok's ad revenues in the US market?

• TikTok is projected to generate $15.53 billion in US ad revenues in 2024, accounting for 15.1% of all US social network spending.
• A one-month ban could potentially cause TikTok to lose up to 29% of its global ad revenue target for the year, the company claims.

Which platforms are expected to benefit if TikTok faces a ban?

• YouTube Shorts and Instagram Reels are expected to be the primary beneficiaries of displaced TikTok ad budgets.
• Other platforms, such as Snapchat and even LinkedIn, are also positioning themselves to attract short-form video ad spending.

What are the long-term implications if the ban goes through?

• The ban could reshape the social media landscape, driving advertisers and creators toward other short-form video platforms.
• While ad budgets would shift to competing platforms, TikTok Shop’s unique integration of social commerce may not be easily replicated.
• Advertisers may face challenges maintaining engagement and sales performance on alternative platforms like Instagram Reels and YouTube Shorts.
• A precedent would be set for regulating foreign-owned social platforms in the US.

Small businesses, particularly those relying on TikTok Shop, could face financial setbacks.

What are experts saying about the likelihood of the ban being enforced?

• Legal scholars like Alan Rozenshtein and Stephen Vladeck say the Supreme Court may uphold the law but leave room for presidential discretion in enforcement.
• Experts emphasize that Trump’s intervention, while unconventional, adds political complexity to the case.

Should businesses and creators start preparing now?

• Yes. Experts recommend businesses diversify their social media presence, archive TikTok content, and establish email or SMS databases for customer retention.
• Businesses should have contingency plans to shift ad spend and engagement strategies to alternative platforms.

Impact on Consumers

What impact would the ban have on US social commerce growth?

• A TikTok ban would undoubtedly hurt the growth of US social commerce, which rosegrew 26% in 2024 to $71.6 billion, driven heavily by TikTok Shop.
• Sales are projected to rise to $85.58 billion this year and surpass $100 billion by 2026.

If TikTok departs the US, won’t other platforms simply replicate TikTok Shop’s success?

• Facebook and Instagram have historically taken a “half-hearted” approach to integrating shopping into their platforms.
• 53% of US consumers distrust products sold via social platforms, according to Aibuy's 2023 Social Media Shopping Report.
• Many social shoppers prefer to browse on social media but complete purchases on retailer websites due to trust and security concerns.

What are TikTok Shop’s latest global moves in response to the US ban?

• TikTok Shop plans to launch in Mexico next month, inviting merchants with locally registered entities to sell on the platform.
• This follows recent rollouts in Spain and Ireland, signaling ByteDance’s efforts to diversify TikTok Shop’s geographic reach.
• Mexico’s ecommerce market is dominated by players like Mercado Libre, Amazon, Walmart, and Liverpool, offering TikTok Shop plenty of competition in a high-growth growth market.

Sources

Associated Press

CNBC

The Economist

The Information

MediaPost

NPR

Politico

South China Morning Post

Wall Street Journal