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, jumps today following a plan by a committee in the White House to pass legislation that would allow the president of the country to block the Chinese competitor Tiktok. The legislation will begin next Tuesday and will include many laws concerning China. The legislation will of course be very negative for Tik Tok, which in 2020 was able to prevent with the help of the court from being blocked by President Trump, who tried to download it from the US app stores.
A TikTok spokesperson stated that “it would be very unfortunate if TikTok were censored from millions of Americans” – the app has over 100 million users across the US. The legislation comes in light of growing tensions between the Chinese and American governments and concerns in the White House that the app can provide a lot of important information about its citizens US to the Chinese. “TikTok is a security threat. It allows the Chinese Communist Party to control and monitor its users while mining a large American dimension for its malicious activities,” says Texas Representative Mike McCall, who is promoting the legislation.
The main beneficiary of the whole story is of course Meta. TikTok is the company’s biggest enemy, specifically when it comes to the Instagram app. Tiktok, which began its journey in 2017, has succeeded in recent years (and especially since the corona virus) in growing at a dizzying pace and becoming the place where a significant percentage of social network users spend their time.
In order to deal with the threat of Tiktok, Meta launched the Reels feature on Instagram, which in a certain way also entered Facebook. The feature does succeed in attracting users to spend more time in the company’s apps, but Tiktok still has the upper hand – according to a test conducted in 2022, the average screen time of Tiktok users was 38.6 minutes, compared to 34.6 minutes on Facebook.
The year 2022 was a very difficult year for Meta, when the stock recorded a low of more than 6 years in the month of November, which stood at a price of 88 dollars per share. From November to the beginning of the month, the stock has risen 125%, after it laid off more than 10,000 of the company’s employees and announced a $40 billion share buyback plan in recent reports. In the last month the stock fell together with the rest of the tech stocks and lost over 10%, the company’s value now stands at 457 billion dollars and it trades according to a future earnings multiple of 17.8
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