As U.S. lawmakers weigh a possible TikTok ban, the ByteDance-owned short-form video app released an economic impact report on Thursday. In it, the company touts the platform generated $14.7 billion for small- to mid-size businesses (SMBs) last year, and a further $24.2 billion in total economic activity, supported through small business’s use of TikTok.
In addition, it says that over 7 million U.S. businesses rely on TikTok and that 224,000 jobs were supported by small business activity on the platform in 2023. Of those, 98,000 jobs were supported directly within SMBs on TikTok. The states with the largest impacts included California, Texas, Florida, New York and Illinois.
The study was performed by the economics forecasting group, Oxford Economics. It measured SMB activity on TikTok, along with ad spend and ROI, and leveraged census data and other measurements to come to its conclusions.
While a report of this size and scope couldn’t be thrown together overnight, the timing of its release is likely not coincidental.
In March, a bill that could ban TikTok passed in the House of Representatives. President Biden said he would sign it into law if it also passes in the Senate. Of concern to TikTok, is that the bill gained bipartisan support, passing the House with a 362-65 vote, despite former President Trump’s change of position on the matter. The Trump administration had previously sought to ban TikTok, calling it a national security risk, but Trump now opposes a ban, saying that Meta would benefit.
Meta is clearly preparing for a possible future where TikTok could be banned, if not spun out from ByteDance. On Wednesday, Facebook was updated to support a new video player across its social network; it will recommend Reels, long-form and Live videos, but default to showing them in vertical format, as on TikTok.
YouTube and other short-form video platforms could also gain increased exposure if TikTok were to be banned, and could pave the way for startups competing in the space, as well.
TikTok’s economic report is a clear attempt to make a case for why the app should be allowed to continue to operate, noting that $5.3 billion in tax revenue last year was supported by small business activity on TikTok, including as a marketing and advertising platform.
The company also presented a variety of case studies where business owners claim that TikTok helped to drive sales, website traffic, and other forms of additional revenue.
Tying the ban to the app’s economic impact is a solid PR strategy — especially since a group of TikTok creators got a judge to successfully block Trump’s TikTok ban in 2020 by saying it would affect their professional opportunities, like brand sponsorships, and ability to make an income.
Though TikTok has been urging users via in-app messages to call Congress to protest a ban, the bill still faces a more difficult path to pass in the Senate — and more so now that the Republican party’s leader has reversed his position on the ban.
The controversial bill that could ban TikTok faces a rocky road in the Senate
