So I tried TikTok

I had to figure out what TikTok was. What is it that required the full weight of the Presidency of the United States? Why do the US and other countries want to ban it? Why are the news paying so much attention to it? Why does TikTok even matter? And why Microsoft (MSFT) and Twitter (TWTR) sniffing around?

Before downloading the app I knew that TikTok was a Chinese video-sharing social media app with short videos mostly about music and dancing. ByteDance, the parent company of TikTok, has 60,000 employees in 126 cities. Beside TikTok they have a bunch of other apps that I never heard of. It goes without saying that TikTok is one of the most popular social media app, especially among young people. Despite its rapid rise, there are still plenty of people — often, older people — who aren’t quite sure what TikTok is, including me until recently. It’s kinda of my job to know these things even if I don’t use them. And I’m a parent of two young guys, so maybe I should be concerned with what’s coming.

To give some background, I often create “ghost” accounts just to check things out and I notice that the same patterns recurring. First I don’t get it. I didn’t get Twitter at first and it took like five years before I started using it. I didn’t get Snapchap (SNAP) and still don’t. I didn’t get Reddit and now it’s awesome. I didn’t get Instagram and now I like it better than Facebook (FB). My thinking at first was “why use Instagram when you have Facebook?” Why use WhatsApp when you have Skype? Why have another app that does almost exactly the same thing as the other one? It takes me a while to understand these Internet trends. Now I use WhatsApp and keep Skype for my mom because the hassle and of getting her a new video conference app is not worth it. I use Twitter, Instagram, Reddit and dislike Facebook. And what they hell happened to Facebook? When I got it around 2006 it was just to post drunk pics. Now Facebook is a giant cluttered monster that decides elections results. You can also see FB’s influence on Instagram where they are starting to clutter the whole thing. So yeah social media is the toilet of the Internet and I’m stuck in it.

After spending some time on TikTok, I don’t not get it. I get it. I can see the appeal but it’s not my thing. Maybe I will get it in five years. I didn’t make a 15-second dance video. Most social media mature over time. Remember Youtube at first? It was just videos of skateboarders falling. Now it where people watch a lot of TV/video content. Twitter was about microblogging what cereals you are eating. Now it’s a source of news. Sure TikTok is full of silly videos now, but once they have the users and the platform, maybe it could turn into something else later on. So yeah these platforms do mature overtime.

I held out a long time before downloading Tik Tok and now I lost an hour of my life (felt like 5 minute) that I’m not getting back. The world seems divided between the never-TikTokers and the TikTok die-hards. First TikTok has a really nice app. It’s easy to use and it just flows. It’s friction less. I would argue that it’s smoother than Instagram, the app du jour at the moment. By spending time on the app I understood some things. I understood why the 18-24 years old spend 80 minutes a day on the app. The thing is a bottomless pit hole. There’s no end. It’s sticky. It’s very efficient at wasting time and making you dumber. Once you put your head up you realized you lost an hour. On TikTok videos are surfaced through a feed algorithmically tailored to show clips that suit your interests. I also saw links in popular culture that I didn’t see before. A lot of people are spending more time on TikTok than on Instagram. And Instagram, a lot of people would argue, is the most successful social platform of the last decade.

One thing I noticed with TikTok is that it doesn’t make users angry or sad. Well that’s my initial reaction. People get off Facebook and Twitter angry. People get off Instagram somewhat depress (here 300 pictures of people having a better life than you). I know I’m overgeneralizing here but I’m just trying to make a point. TikTok is dancing and music. That’s doesn’t make people sad or angry. Users that get off TikTok are somewhat cheer up, like they have tapped into a certain level of joy. So unlike Instagram I don’t think TikTok cause depression (yet). I should mention that Instagram has a TikTok clone called Reels, I think it’s a feature inside the Instagram app.

Now I think TikTok was the fastest app to have a billion users. President Donald Trump has given China’s ByteDance until September 15 to sell its U.S. operations, including its TikTok video-sharing app, or face a shutdown. Why? The full answer is too long for this post and there’s a lot of back story to this. The short version is that the US and China are having a cold war fought on many front (trade, tech, space etc…) and TikTok is in the middle of it. The big concern from the White House is  national security and privacy. That data could be weaponized and used against a nation. TikTok says it has about 100 million monthly users in the U.S., and denies it would hand over user data to the Chinese government. Under China’s laws, companies operating there must comply with any government request to turn over data. Also big companies in China have employees who might be affiliated with the China’s Communist Party. There’s also a worry that the app could be used to spread Chinese propaganda. Other issues: The NYT claims that a third of users may be under 14, which brings it lot of problems. The minimum age for using TikTok is 13. 

Microsoft has confirmed that it has held talks with TikTok. Why are they interested? The deal would land Microsoft the breakout social-media player of this decade. It would give Washington a win over Beijing by bringing a Chinese technology crown jewel under U.S. ownership. For TikTok parent ByteDance it would resolve the national-security concerns that threatened to thwart its U.S. operations.The app could eventually challenge Facebook for users and ad revenue. TikTok globally isn’t profitable. ByteDance projects the app will have $1 billion in revenue this year and $6 billion next year. Microsoft would probably move TikTok on its Azure platform and just mine the data. Microsoft currently has $136b in cash. TikTok is interesting because one day it could be a very valuable media companies in terms of their advertising revenue.

I saw in the news that Twitter was interested in TikTok. Sounds like a long shot. I can’t help being reminded that Twitter bought and shut Vine (RIP), a similar short-form video app. And to add insult to injury Vine’s most popular live on Youtube. Twitter has a market cap of $30 billion, roughly equal to what potential rival bidder Microsoft could pay for TikTok. So Microsoft is better positioned to buy TikTok. But the question of financing becomes somewhat less onerous considering that Twitter has investors such at Elliott and private-equity giant Silver Lake.

Anyway, these are my thoughts on the TikTok phenomenon. The next couple weeks should be interesting.

2 thoughts on “So I tried TikTok

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s