US House Passes TikTok Ban—What You Need To Know

The U.S. House of Representatives passed a bill Wednesday that would require China’s ByteDance to divest TikTok or face a ban of the social media app in the U.S., impacting 170 million users.

The Protecting Americans from Foreign Adversary Controlled Applications Act “prohibits distributing, maintaining, or providing internet hosting services for a foreign adversary controlled application (e.g., TikTok).”

The bill was introduced by House Republicans who said the app could pose a national security threat due to its ties to ByteDance, TikTok’s Chinese parent company, citing concerns China’s government could potentially require it to share data. After passing with bipartisan support, the bill moves to the Senate.

The regulation could also apply to other social media companies that are “controlled by a foreign adversary and [have] been determined by the President to present a significant threat to national security,” but is currently targeting only ByteDance and TikTok by name.

The U.S. government previously moved to ban the app in 2023, but the proposed legislation failed to get the support needed to become law. The app was banned on some government devices.

There are more than 170 million TikTok users in the U.S. who would be affected by a ban. The platform is especially popular with younger generations, with Pew Research finding that more than half (56%) of U.S. adults ages 18 to 34 use the app.

TikTok shows users content on their “For You” page that is curated for each individual using the platform’s algorithm. All accounts “regardless of their privacy settings – contained basic account metadata,” Pew Research reported.

The app is home to a wide range of content including users sharing their opinions on political and economic issues, which could play a role in the upcoming U.S. presidential election, J.P. Morgan researchers found.

“The number one issue driving voters across both parties remains the economy and partisanship is shaping economic perceptions,” the analysts wrote, adding that “the disconnect between solid fundamentals vs. poor consumer sentiment has been a major focal point for the Biden administration as there is concern that the sentiment is reflecting what is heard from social media apps such as TikTok.”

Analysts indicated that a national TikTok ban could benefit Snap (SNAP), Meta (META), and Google parent Alphabet (GOOGL).

CFRA analyst Angelo Zino wrote that if the bill were to become law, “SNAP would be the best way to play,” adding that “most U.S.-based short-form video offerings could see improving engagement levels (SNAP, META’s Reels, and GOOGL’s YouTube business, in that order).”

The analysts did note that the firm has “doubts about this bill gaining enough support from Democrats in a presidential election year given the popularity of the app.”