Ann Arbor Times

Justin Huang, an assistant professor of marketing at the University of Michigan’s Ross School of Business, has been analyzing the situation surrounding TikTok as the deadline for a potential ban on the platform approaches. Huang offers a thorough examination of possible scenarios.

One possibility is the acquisition of TikTok. Huang notes speculation about companies like Blackstone, General Atlantic, and Susquehanna International Group acquiring the platform, with Oracle ensuring data security. However, Huang points out that "the major sticking point here will be Chinese government approval" due to China’s technology export restrictions on TikTok's algorithm. He notes, "There is a small chance that TikTok could be sold without its algorithm or through a more complex licensing agreement."

Another scenario is that TikTok could receive another extension through an executive order. Huang describes this as "the easiest and most likely outcome," suggesting President Donald Trump might consider an additional extension, as he stated he would "probably" consider this option to achieve a favorable resolution. Huang adds that while some senators and Congress members have objected to previous extensions, they are unlikely to block another.

As for a complete ban, Huang outlines that this outcome would lead users, creators, small businesses, and advertisers to move to other platforms such as RedNote, Instagram Reels, and YouTube Shorts. He cites RedNote's previous rise in the U.S. app market following an initial TikTok ban, partially due to public backlash. This scenario poses challenges for businesses and creators. Huang highlights research by his colleagues, Dante Donati and Hortense Fong, indicating that ad prices on rival platforms increased by 10% after the first ban, negatively affecting businesses advertising there and placing additional strain on small businesses.

Overall, while acknowledging several outcomes, Huang's analysis provides insight into the complexities TikTok faces as the deadline nears.