TikTok and WeChat Both Avoid an App Store Ban for Now
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Last week the U.S. Department of Commerce announced a ban on both TikTok and WeChat that would remove both from all U.S. app stores starting Sunday, September 20. That date has passed, and both apps are still available for download. Both apps managed a reprieve, but it still remains to be seen how long that will last.
TikTok’s attempt to avoid a ban involved a buyout process that would turn into a U.S. company. The U.S. administration had said that nothing less would be acceptable, due to national security concerns. In the beginning, Microsoft was the frontrunner to purchase TikTok from Chinse parent company ByteDance, but those talks fell apart.
Oracle and Walmart teamed up and won the bidding process, but that left ByteDance as the majority owner, with Oracle merely owning a 20% stake. When the U.S. Department of Commerce announced the impending ban, it seemed the Oracle/Walmart bid wasn’t good enough.
But things change quickly, and now President Trump has given his approval of the Oracle and Walmart deal to purchase a stake in TikTok. The exact details are murky, though. According to Oracle’s CEO: “Upon creation of TikTok Global, Oracle/Walmart will make their investment and the TikTok Global shares will be distributed to their owners, Americans will be the majority and ByteDance will have no ownership in TikTok Global.”
ByteDance seems to disagree and maintains it will have majority ownership of TikTok. In any case, the U.S. Department of Commerce announced it will push back the ban by one week to September 27, 2020 at 11:59 p.m (no timezone given). So for now, TikTok remains available in app stores for download while all the companies involved hash out the details.
WeChat, on the other hand, isn’t involved in a buyout of any form. Instead, the courts intervened to block the ban. WeChat users sued on behalf of the company, arguing that a ban would impede First Amendment free speech rights.
U.S. Magistrate Judge Laurel Beeler agreed, and blocked the ban on those grounds, writing “the plaintiffs have shown serious questions going to the merits of the First Amendment claim, the balance of hardships tips in the plaintiffs’ favor, and the plaintiffs establish sufficiently the other elements for preliminary-injunctive relief.”
The U.S. Department of Commerce didn’t comment on the ruling, but it can appeal to attempt to overturn the order and followthrough with the ban. So WeChat isn’t out of the woods just yet.