What Commerce’s WeChat-TikTok announcement really means
Will WeChat and TikTok stop working Sunday? What does this mean for TikTok's competitors? And other questions, answered.
The Department of Commerce announced Friday that it would ban both WeChat and TikTok from U.S. app stores beginning on Sunday in response to President Trump's August executive orders, which prohibited any transactions with either platform as of Sept. 20.
The Commerce Department's notice clarifies those orders, specifying that WeChat will also be prohibited from using U.S. internet hosting or content delivery network services beginning Sunday. TikTok will be barred from doing so starting Nov. 12.
The announcement added to the confusion that has been building around TikTok for weeks, as a who's who of corporate giants, including Microsoft, Oracle and even Walmart have battled for a stake in the hugely popular video-sharing site.
Here are answers to some of the big questions about the fate of TikTok and WeChat in the United States.
Does this mean WeChat and TikTok will stop working on Sunday?
WeChat, yes. TikTok, no. The Commerce Department will prohibit either app from appearing in U.S. app stores or accepting updates as of Sunday. That means new users in the U.S. won't be able to download either WeChat or TikTok starting Monday at midnight, and existing users won't receive updates to the apps. But only WeChat will break completely because, unless it can find a workaround, it won't be able to use U.S. hosting services. That won't happen for TikTok until mid-November. Even though it won't be available to new users, TikTok won't be removed from current users' phones. Apple makes clear that an app's removal from the App Store doesn't prevent current users from accessing it on their device. But without updates, TikTok's functionality could steadily deteriorate.
Isn't TikTok about to get sold off? What happens then?
TikTok's Chinese parent company, ByteDance, has been negotiating a deal for weeks in hopes of satisfying the president's national security concerns. If it secures a deal, then the Commerce Department's announcement will be lifted for TikTok. (But not for WeChat.) According to recent reports, a deal is expected to be reached this week. But even if that doesn't happen, this announcement means that TikTok has until Nov. 12 to reach a deal and avoid a true disaster scenario in the U.S.
Where does the deal stand?
Details of the TikTok deal appear to change every hour. The most recent reporting suggests that Oracle will take a minority stake in the company and lead its U.S. operations, hosting and processing U.S. user data. TikTok would also reportedly appoint a U.S. government-approved board of directors, consisting of U.S. citizens and an independent security expert. But what role and ownership stake ByteDance will continue to have remains unclear. President Trump has said he would not be happy about a deal that left ByteDance with majority ownership. But the Commerce Department's timeline gives TikTok plenty of time to reach an agreement.
Who else will this affect?
The fallout from this announcement won't just affect WeChat, TikTok and their users. It will also have implications for the many other businesses that work with WeChat and TikTok. TikTok, for instance, signed a three-year agreement with Google to purchase $800 million in cloud services last year. Such an agreement would be prohibited after November under the Commerce Department's ruling.
The announcement will also affect both Apple and Google, which will be forced to pull one of their top-performing apps, TikTok, from their app stores in the U.S. Because the order is limited to only U.S. app stores, however, Apple may escape a worse fate predicted by some analysts, who worried that if the Trump administration forced Apple to remove WeChat from the App Store worldwide, it could tank iPhone sales by as much as 30%.
One category that could get a boost from the ruling: VPNs, which will be used to get around the restrictions. On Friday, the term "VPNs" was trending on Twitter in the U.S.
What does this mean for TikTok employees?
TikTok has been on a hiring spree this year, more than tripling its U.S. headcount since January. When President Trump issued his August executive order, some employees worried that the prohibition on transactions with ByteDance could stand in the way of them getting paid after Sept. 20. One employee, Patrick Ryan, even took the Trump administration to court over it. The case has since been dismissed, after the Department of Justice said the Commerce Department would clarify the order so that it wouldn't apply to employee compensation. With this announcement, the Commerce Department is making clear what types of transactions President Trump's orders apply to. "Any other prohibitive transaction relating to WeChat or TikTok may be identified at a future date," the Department wrote.
Is this good for TikTok and WeChat's competitors?
Not according to them. Adam Mosseri, head of TikTok's most direct rival, Instagram, has repeatedly warned against the risks of creating a bifurcated internet based on different countries' national security interests. From Mosseri's point of view, all internet companies benefit from being able to expand globally, reaching users regardless of where in the world they live. "I've said this before, but a U.S. TikTok ban would be quite bad for Instagram, Facebook, and the internet more broadly," Mosseri tweeted Friday. "If you're skeptical keep in mind that most of the people who use Instagram are outside the U.S., as is most of our potential growth. The long term costs of […] countries making aggressive demands and banning us over the next decade outweigh slowing down one competitor today."
Legal scholars echoed Mosseri's concerns on Friday, noting that the announcement sets a dangerous precedent for U.S. citizens' First Amendment rights. "It's a mistake to think of this as (only) a sanction on TikTok and WeChat," wrote Jameel Jaffer, director of the Knight First Amendment Institute at Columbia University. "It's a serious restriction on the First Amendment rights of U.S. citizens and residents — a restriction that the Trump admin should have to justify."
TikTok is currently challenging President Trump's executive order in court. On Friday, TikTok's interim head Vanessa Pappas replied to Mosseri, urging Facebook to get behind the case. "We agree that this type of ban would be bad for the industry," Pappas wrote. "We invite Facebook and Instagram to publicly join our challenge and support our litigation. This is a moment to put aside our competition and focus on core principles like freedom of expression and due process of law."