Bad News! Banning TikTok on US Government-Owned Devices Could Scare Advertisers

JAKARTA - A proposal to ban US federal employees from using the TikTok app on government devices looks set to become law, threatening to damage the Chinese company's reputation and scare away advertisers, though it won't affect many users.

US lawmakers on Tuesday morning, December 20 have included the proposal in the main discussion bill, as first reported by Reuters. In fact, they almost confirmed passage this weekend after a vote in the US Senate approved a similar measure. The bill will become law after US President Joe Biden's signature.

The move is the latest US effort to crack down on the popular social media platform, which has been the subject of many recent state bans and a long-running US national security investigation over fears the app could be used by the Chinese government to censor content or spy. American eyes.

While the new federal ban, it is not expected to significantly reduce TikTok's estimated 130 million US users. But experts consulted by Reuters said the move could damage the company's reputation, which in turn could discourage advertisers from advertising on TikTok.

"That's a big risk for TikTok: having that brand reputation (hit) has an impact on the overall monetization revenue they can generate," Eunice Shin, partner at brand strategy, Nabi, told Reuters.

TikTok said in a statement that it was "disappointed that Congress has moved to ban TikTok on government devices — a political gesture that will do nothing to advance national security interests — rather than push the Administration to complete its national security review."

The ban is tucked into a massive omnibus act to fund US government operations expected to be voted on this week. The bill gives the White House Office of Management and Budget 60 days "to develop standards and guidelines for executive agencies requiring the removal" of TikTok from federal agencies.

Many federal agencies, including the White House and the Departments of Defense, Homeland Security, and State, have banned TikTok from government-owned devices.

"The ban was minimal, very minimal on TikTok's overall user base," said Matthew Quint, brand expert at Columbia Business School. "The question is further, 'will this action get the ball rolling to create a bipartisan movement to completely ban the service because of the potential threat to national security?'"

Last week's proposal had the backing of Democratic House Speaker Nancy Pelosi and Republican Speaker of the House Kevin McCarthy.

But previous offers to ban the app have run counter to free speech issues. In 2020, Republican President Donald Trump attempted to block new users from downloading TikTok and ban other transactions that would effectively ban use of the app in the United States, but lost a series of court battles partly over free speech grounds.

Efforts to ban the app have intensified in recent weeks after US FBI Director Christopher Wray said last month it posed a national security risk, marking a threat that the Chinese government could use the app to influence users or control their devices.

On Monday December 19, state agencies in Louisiana and West Virginia became the latest to ban the use of TikTok on government devices over fears that China could use it to track Americans and censor content.

About 19 of the 50 US states are now at least partially blocking access on government computers to TikTok. Most of the restrictions appeared in the last two weeks.

The US government's Committee on Foreign Investment in the United States (CFIUS), a national security agency, has been trying for months to reach a national security agreement to protect US TikTok user data, but it appears no agreement will be reached before the end of this year.