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  • 2020 has been a year of chaos, uncertainty and grief.

  • A global pandemic, record unemployment and nationwide protests have left

  • people reeling. Through it all though, there's been TikTok, providing

  • moments of levity and new dance crazes, interspersed with more serious

  • commentary on the issues that we face.

  • TikTok, it's like the party you want to be at, a t the moment.

  • You'll see hair tutorials, cooking tutorials.

  • People can create challenges, they can create duets, th ey can interact,

  • they can engage. TikTok is the most downloaded app of 2020.

  • Since its global release less than two years ago, TikTok and its Chinese

  • counterpart, Douyin, have amassed 800 million monthly active users, more

  • than Reddit, Snapchat or Twitter.

  • Its parent company, ByteDance, is the most valuable startup in the world.

  • Its reach might surprise you unless you're a member of Gen Z or the parent

  • of one. But as millions scramble for connection amidst quarantines, more

  • and more users of all ages are hopping aboard.

  • We're all just kind of going through the same thing together.

  • And we happen to be documenting it all through TikTok.

  • It's not all rosy, though.

  • The Chinese-owned app faces a slew of regulatory hurdles, privacy concerns

  • and allegations of censorship.

  • Amidst these struggles, it's brought in a new CEO.

  • This guy is Kevin Mayer.

  • Formerly the Head of Streaming at Disney.

  • That's basically what Kevin Mayer's first priority needs to be, is to make

  • sure that Americans trust TikTok.

  • In the long run, that may prove complicated.

  • But in the short term, it hasn't prevented tens of thousands of new users

  • from signing up. The predecessor to TikTok was an app

  • called Musical.ly. Founded in 2014, it provided a platform for users to

  • create short, 15 second videos set to a song of their choice.

  • The content mostly involved lip-syncing and dancing, and it took off

  • quickly among preteens and teens in the U.S.

  • This is an app that was built around the fact that there was music that was

  • licensed to be used on this app.

  • This was something that Musical.ly decided really to invest in, because

  • they knew that music and sharing music was inherently social.

  • By July 2015, a year after its launch, Musical.ly reached number one in the

  • iTunes app store.

  • It continued to grow and was bought by the Beijing-based startup ByteDance

  • for one billion dollars in 2017.

  • ByteDance already owned Tik Tok, a similar video sharing platform, and

  • merged the two apps less than a year later.

  • Now TikTok's main office is in Los Angeles, California.

  • They're essentially an American startup that is subsidized by a successful

  • Chinese tech company.

  • As the app has grown, it's given rise to a whole new pack of social media

  • celebrities. Content is public by default on TikTok, and the algorithm

  • that determines what appears on a user's home page gives every creator the

  • chance to put their video in front of millions.

  • Really what we saw was a different style of humor.

  • It wasn't the sketches that you saw on Vine, and it wasn't longer-form

  • YouTube videos. It was meme culture or like the general public's take on a

  • meme. What I enjoyed about it is there was some deeper humor in there if

  • you were paying attention to the trends that were happening.

  • On Ti kTok, King uses creative video editing to make it look like he's

  • performing magic tricks, a skill which has earned him over 44 million

  • followers, the second most on the app as of June 2020.

  • But at 30, King represents the rare millennial that's broken into TikTok's

  • top ranks. Many of the most followed users are in their teens, and lip

  • syncing and dancing remain wildly popular.

  • So I originally started when I was 14 years old, and so I started using my

  • facial expressions and hand motions to make these like larger than life

  • lip sync videos.

  • And as I grew up, I think the app also grew up.

  • Now there's so much more that you can do.

  • While Martin has found her niche with dancing and lifestyle content, she

  • says there's something out there for everyone.

  • There's like creators who are huge when it comes to comedy, some still do

  • lip syncing, some cooking videos, tutorials.

  • You can do whatever you want as long as it's fun, it's quick and it

  • catches people's eye.

  • Stay at home orders have propelled the app's rapid growth in the United

  • States. So between October and March, according to research fro m

  • Comscore, its unique visitors has grown from 27 million to 52 million, so

  • doubled in the past five months.

  • And within that time period, just in March alone, according to Comscore

  • TikTok added 12 million new unique visitors.

  • People in the U.S.

  • on TikTok spent more time on TikTok than Instagram users spent on

  • Instagram or Snapchat users spent on Snapchat in the month of March.

  • That's a big deal since Snap and Instagram are two of the app's main

  • competitors. They're all extremely popular among young users, b ut in the

  • U.S. at least, TikTok still has some catching up to do.

  • We estimate that this year TikTok will have 45 million users.

  • But Instagram, we're estimating will have over 110 million and Snapchat

  • will have 85 million users.

  • But TikTok is also huge abroad, especially in India and China.

  • In China, it operates as a technically separate but very similar app

  • called Douyin. And in the first quarter of 2020, TikTok and Douyin were

  • downloaded 315 million times globally, a 68 percent increase over the

  • previous year. In April, the company reached two billion overall

  • downloads. India is by far the app's largest market when it comes to

  • downloads, accounting for 30.3 percent of the total.

  • But China is definitely the largest from a revenue standpoint, accounting

  • for about 72 percent of total spending on the app.

  • The U.S. is third in terms of downloads and second in terms of revenue,

  • and its influence continues to grow.

  • Viral dances and memes have propelled a number of songs to the top of the

  • U.S. charts, most famously, Old Town Road in 2019 .

  • And now the moms, dads and siblings of the TikTok o bsessed have started

  • to get in on the trends as well, learning dances and performing challenges

  • together. You're still laughing at them, but actually the fact that

  • parents are getting on it, I mean they needed that demo so badly to even

  • make it to this level that they're at now.

  • In order to build out a sustainable revenue model, e xperts say that TikTok

  • eventually needs to attract older users.

  • Advertisers are going after broader demographics and especially those with

  • purchasing power.

  • But TikTok is not under immediate pressure to make money just yet.

  • Its parent company ByteDance is valued at over 100 billion dollars and

  • made three billion dollars in revenue last year.

  • That's because it owns a host of other, more profitable Chinese apps, most

  • notably Douyin and a news aggregator called Toutiao.

  • TikTok's revenue model is still very, very nascent.

  • This is a company that has some advertising, we have some of the users

  • starting to do sponsorships.

  • But at the end of the day, this is a company with hundreds of millions of

  • users here in the U.S.

  • that's still not making as much money as it could some day.

  • Monetization aside, many say that CEO Kevin Mayer's first priority needs to

  • be the regulatory and privacy concerns facing the app, which stem from its

  • Chinese ownership as well as its popularity among children.

  • You know, it's never been the case that so many Americans are putting so

  • much of their visual data in the hands of a Chinese company.

  • And as we know, the relationship between the Chinese government and

  • Chinese corporations is a pretty tight one.

  • While TikTok claims that all American user's data is stored within the U.S.

  • and is not subject to Chinese law, many security experts remain skeptical.

  • Similar concerns exists in India, where data protection laws are weaker

  • and thus citizens are more vulnerable.

  • Regulators are going to be very weary of that separation.

  • Where's the data held?

  • What's the cross-pollination look like?

  • A number of incidents over the years have provided ample reason for worry.

  • An investigation by The Guardian last September revealed that TikTok

  • moderators were instructed to censor videos related to Tiananmen Square

  • and other content deemed sensitive by the Chinese government.

  • While the company claimed that these guidelines had been phased out by the

  • time of the investigation, it still helped spur the Federal Committee on

  • Foreign Investment in the United States to open an ongoing review into

  • ByteDance's acquisition of Musical.ly.

  • It seems unlikely that ByteDance would be forced to divest itself of what

  • was Musical.ly, now is TikTok.

  • But I do think that this all speaks to the great amount of concern and

  • oversight over this app that's gone from a tiny little thing to this huge

  • powerhouse. Most recently, the app received criticism for what it said was

  • a technical glitch, in which post tagged with #BlackLivesMatter and

  • #GeorgeFloyd appeared to have zero views when they actually have over two

  • billion. And in the past, both India and Indonesia have instituted brief

  • bans on the app due to concerns over inappropriate content like violence

  • and pornography. Lastly, there are ongoing issues regarding children's

  • privacy. Users under 13 are technically not allowed on TikTok, but there's

  • not much really preventing them from signing up.

  • In February 2019, the company paid 5.7 million dollars to the FTC to

  • settle charges that it was illegally collecting children's personal

  • information. This then prompted the U.K.

  • to conduct their own investigation into the matter.

  • While TikTok said it would make changes, in May 2020 a coalition of

  • consumer groups filed a complaint stating that TikTok had not kept its

  • promises. It's all undoubtedly a lot for Mayer to inherit.

  • But given his background at Disney, some say he may be exactly the right

  • person to address these concerns.

  • So he is someone who has experience dealing with regulation, dealing with

  • oversight, and especially dealing with online security issues, which are

  • certainly front of mind for TikTok as they navigate their relationship

  • with the FTC. If Mayer can secure the trust of U.S.

  • consumers and investors, Byt eDance could be well positioned for an IPO in

  • the next year or two. Beyond that, experts say that TikTok's long-term

  • prospects depend upon its ability to keep users engaged while building out

  • a sustainable monetization strategy.

  • YouTube could be seen as a model in the way that YouTube shares advertising

  • revenue with its content creators.

  • Mayer's background in streaming services also has both analysts and

  • creators excited about what new forms of content may lie on the horizon.

  • I have been begging TikTok to get into the streaming game.

  • People have speculated that TikTok might get involved in original

  • programming. To make TikTok sustainable, you're going to have to do

  • long-form content.

  • I don't see a version where you make 60 second videos forever and it stays

  • cool for another two to three years.

  • King also says TikTok's live-streaming feature has room to grow.

  • It's super popular in China, but hasn't yet taken off in the U.S.

  • I think what's next for TikTok is how they figure out how to make money,

  • how they figure out how to create a home for advertisers, and how they

  • make sure that content creators themselves want to stick around and don't

  • want to go jump off to whatever the next cool app is going to be.

2020 has been a year of chaos, uncertainty and grief.

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