The potential ban of TikTok, a Chinese-owned video-sharing app, could significantly benefit its publicly traded competitors. On Friday, the U.S. Supreme Court will hear arguments regarding a bipartisan law set to ban TikTok on January 19 if it remains under the control of its Chinese parent company, ByteDance Ltd.
If TikTok is banned, much of its advertising revenue, estimated at $10.1 billion in 2023 and projected to reach $12.8 billion in 2024, could shift to rivals like Meta Platforms (Facebook and Instagram) and Alphabet (YouTube and Google), which collectively generated over $165 billion in U.S. ad revenue last year. Analysts suggest these companies could capture 80-90% of TikTok’s ad dollars, with the rest potentially going to Pinterest and Snap.
Morgan Stanley analysts also see Meta, Alphabet, and smaller platforms like Reddit, Pinterest, and Snap benefiting from TikTok’s exit. TikTok has pledged to cease U.S. operations by January 19 unless the Supreme Court blocks the law, citing concerns over free speech for its 170 million U.S. users. Supporters of the ban argue that TikTok, due to its ties to the Chinese Communist Party, poses a national security risk.
Entrepreneurs Frank McCourt and Kevin O’Leary recently proposed acquiring TikTok’s U.S. assets through a group called “The People’s Bid for TikTok.” Analysts have speculated that companies like Amazon, Microsoft, Walmart, and Oracle could also express interest in acquiring TikTok. Oracle, a major TikTok partner, could face financial challenges if the app is banned, as TikTok generates $370 million annually for its cloud-computing business.
As of now, a betting market gives TikTok a 57% chance of being banned in the U.S. by May.
