JUST IN: TikTok owner prefers shut down in US over sale

TikTok’s parent company, ByteDance is contemplating shutting down the app in the US instead of selling it, Reuters reported citing four sources.

This decision was made as ByteDance faces legal challenges following legislation seeking to ban the platform from US app stores.

According to the sources familiar with the matter, it is unlikely for TikTok to be sold along with its crucial algorithms, as these algorithms are considered essential to ByteDance’s overall operations.

US President Joe Biden recently signed into law a bill seeking to ban the social media app in the country.

The measure, previously approved by the US Congress, mandated that ByteDance, which is based in China, sell the app within nine months or risk being banned from the US.

The law was introduced due to concerns that TikTok might share user data with the Chinese government — a claim the company has consistently denied.

Although TikTok only contributes a small percentage of ByteDance’s overall income and daily active users, the parent company reportedly would prefer to see the app blocked in the US in the worst-case scenario rather than sell it to an American buyer.

The sources, who asked not to be named because they were not permitted to speak to the media, stated that ByteDance’s basic algorithm would still be available even if the company were to shut down and that the closure would have minimal influence on the company’s revenue.

TikTok currently boasts 170 million American users.

According to a separate source with direct knowledge, the US contributed approximately 25% of TikTok’s total revenues last year