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Hoping to avoid a ban, TikTok said it generated $14.7 billion for small businesses in the U.S. last year

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Photo credit: Patrick T Fallon/AFP/Getty Images

As U.S. lawmakers weigh a possible TikTok ban, ByteDance's short-video app released an economic impact report on Thursday. In it, the company touts that the platform generated $14.7 billion for small and medium-sized businesses (SMBs) last year and generated another $24.2 billion in overall economic activity through small businesses' use of TikTok had been.

Additionally, it says that over 7 million U.S. businesses trust TikTok and that 224,000 jobs were supported by small business activity on the platform in 2023. Of these, 98,000 jobs were supported directly at SMEs on TikTok. States with the greatest impact included California, Texas, Florida, New York and Illinois.

The study was conducted by economic forecasting group Oxford Economics. It measured SMB activity on TikTok, as well as ad spend and ROI, and used census data and other measurements to reach its conclusions.

While a report of this size and scope cannot be put together overnight, the timing of its publication is unlikely to be a coincidence.

In March, legislation passed in the House of Representatives that could ban TikTok. President Biden said he would sign it into law if it also passed in the Senate. Worryingly for TikTok, despite former President Trump's change of position on the issue, the bill received bipartisan support and passed by a vote of 362-65 in the House of Representatives. The Trump administration had previously tried to ban TikTok, calling it a national security risk, but Trump now opposes a ban, saying it would benefit Meta.

Meta is clearly preparing for a possible future in which TikTok could be banned or spun off from ByteDance. On Wednesday, Facebook updated to support a new video player on its social network; Reels, long format and live videos are recommended, but these are displayed in portrait mode by default, like TikTok.

A ban on TikTok could also boost YouTube and other short video platforms, paving the way for startups to compete in this space.

TikTok's economic report is a clear attempt to make a case for why the app should continue to operate. He points out that last year, small business activities on TikTok, including as a marketing and advertising platform, generated $5.3 billion in tax revenue.

The company also presented a series of case studies in which business owners claim that TikTok has helped increase sales, website traffic and other forms of additional revenue.

Tying the ban to the app's economic impact is a sound PR strategy — especially since a group of TikTok creators persuaded a judge to successfully block Trump's TikTok ban in 2020, saying it would their professional opportunities, such as brand sponsorships, and their ability to start an app impact income.

Although TikTok has urged users via in-app messages to call Congress to protest a ban, the bill's passage in the Senate still faces a more difficult road – even more so after the Republican Party leader changed his position changed to the ban.