The US Supreme Court ruled to uphold the law banning TikTok in the US unless the company sells to a non-adversary by January 19. If TikTok does not sell its ownership, the app’s revenue and 170 million users could be consequential, with platforms like Instagram (META), YouTube, and Snapchat (SNAP) poised to gain traffic.
Rohit Kulkarni, Roth Capital Partners senior research analyst, joins Catalysts to speak on the uproar as well as the legal risks for Apple (AAPL) and Google (GOOG, GOOGL) that would lead to TikTok being removed from their respective app stores.
"This is a significant event in the history of tech and cross-border tech," Kulkarni says. He explains that the significant number of hours people spend on TikTok will likely go to companies like Instagram, YouTube, Snapchat, and "maybe other companies like Reddit (RDDT) and Pinterest."
It is also unclear where TikTok’s high revenue will be redirected after the ban. Kulkarni suggests that money "would just follow the waterfall of the market share."
In particular, he posits, "Google and Facebook [are] the biggest market share companies; most likely, advertisers would probably take that money away from TikTok and go back to those two."
"The reality is that Apple and Google will likely remove TikTok from the app store, which means in the next month or so, users are going to be in a limbo, advertisers are going to be in a limbo," Kulkarni explains.
Additionally, Kulkarni suggests Trump could use TikTok as leverage in US-China negotiations.
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