TikTok: Slipping and Dipping or Plotting and Planning?
July 15, 2022
I read “TikTok Aborts Europe, US Expansion Ambitions Shortly After US Senate Inquiry.” Surprising? Not really. TikTok and its ByteDance Ltd. “partner” is it appears rethinking how to capitalize on its popularity among the most avid, short attention span clickers. The article explains that TikTok is not too keen on selling via its baby super app. The reasons are, according to the cited article and the estimable orange newspaper, are “internal problems and failure to gain traction with consumers.”
With the management savvy of the Chinese government, it seems to me that resolving “internal problems” was a straightforward process. Identify the dissenter and let the re-education camps work their magic. The problem with “traction” is that I don’t see much hard evidence that a super app which bundles promoting, buying and selling is unpopular with consumers. The TikTok generation is pretty happy following an influencer and buying whatever the person pitches: Coffee, wellness stuff, makeup, and “so cute” gym clothes.
For me the news story is too far from the horseshoe stake of credibility. I think we have a PR play engineered to get people to say, “See, TikTok is a company which recognizes that it cannot do everything.”
I am skeptical. Here are three reasons I spelled out to my colleagues at lunch today:
- TikTok denizens are selling and are unlikely to stop. At some point, ByteDance is going to want a piece of the action.
- TikTok is becoming a super app. Its users will demand additional functionality. If it is not delivered, the clever little clickers will create add ins. Will ByteDance sit on its hands and fail to monetize enhancements and extensions to the TikTok app?
- TikTok does not want to be shut down; therefore, cooing and trying to avoid getting in trouble with US and European regulators is a high priority. Why? The data are priceless.
Net net: Will TikTok do the adulting to behave in a non capitalistic manner? Pick one: [a] No or [b] No. This is less of a company versus company action and more of a government playing Go against an opponent playing checkers.
Stephen E Arnold, July 15, 2022
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