TikTok, the viral social network for creating and viewing short videos owned by the Beijing company ByteDance, is under the threat of potential prohibition in the United States, doubtful of their future operations in the country. The President’s administration assumed that the involvement of China imperils the US’s internal security. In particular, the American government accused Beijing of collecting and sharing valuable user data of the target platform with the Chinese Communist Party (CCP). The intention of banning TikTok in the US is a rare and unforeseen event in the democratic country, while China has been blocking foreign companies throughout the years. However, given the fact that TikTok is the first internationally popular network, which is not originated from the US, the American government might be trying to protect its domestic social media giants. Examination of the legitimacy-based view of political risk will help to understand the motives of the US to intervene in international business.
Political risk plays a critical role in a decision whether a firm will invest in a foreign economy. It refers to the situation of whether an investment will lead to “adverse impacts” on its operations regarding the host country’s (HC) “political environment” (Stevens and Newenham-Kahindi, 2016, p. 4). Legitimacy-based view (LBV) helps to gauge the level of political risk. LBV implies the government’s involvement in consideration of features and activities of international companies in (HC) and assessing their compliance with its economic, legislative, and societal objectives (Charpin, Powell, and Roth, 2020). There are three types of LBV: pragmatic, moral, and cognitive. The first form determines a company as legitimate if its activities are perceived to add benefits to a group of agents interested in HC’s welfare. Moral legitimacy includes social norms and standards, according to HC’s set of values. An organization is morally legitimate provided that it does not violate or disregard those rules, operating on its terms and conditions. Next, the cognitive side of legitimacy covers a subliminal acknowledgment of a firm’s presence and activities. Thus, to explain the US’s ban on TikTok, all three components will be used for this purpose.
The question of national security contributed to losing pragmatic legitimacy in the view of the US. The government addresses the issue of data storage concerning its illegal transmission to CCP (Wang, J., 2020). Trade war and current political tension with China did not facilitate the improvement of the state of affairs. Moreover, TikTok users participated in false registration for the Tulsa rally, where Trump was supposed to host a grand show to raise the results of his poll and boost the chances of winning the next presidential elections. The devastating and embarrassing experience on the part of the President led to a fall in the company’s pragmatic legitimacy. Additionally, the American government claims that TikTok’s censorship policy is tied to CCP’s political and social views, hiding such information as Hong Kong protests (Koleson, 2020). However, Anderson (2020, p. 9) states that the platform’s censure challenges are not “unique” since most companies find it hard to follow specific guidelines. General public and platform users side with the company, claiming the government’s false and unfounded. Hence, the US’s safety fears lowered TikTok’s pragmatic legitimacy, while staying strong in the eyes of the public.
TikTok is a vast social media platform where users are free to expose their opinions, including political beliefs and standpoints. Therefore, the company’s moral legitimacy is at stake when such an opportunity arises for extremist groups (Weimann and Masri, 2020). The US considers the company too vulnerable and unprotected from radical influence, undermining values and conditions existing in the country. Furthermore, various facets of life akin to “beauty, cooking, cinema, education” are impacted by the content created by TikTok users (Wang, Y., 2020, p. 2). The American government is disturbed by the extent of the sway the app has on the American people. Nonetheless, the publicity can argue and object to a claim since it is the government that violates fundamental constitutional rights. Americans exercise the First Amendment to protect their freedom of speech, increasing TikTok’s moral legitimacy. Young users, who over the past two years adopted the app as a way of self-expression, perceive the government’s intentions as oppressive and tyrannical. Thereupon, the vision and status of moral legitimacy depend on the side of the argument. It is reduced from the government’s point of view, whereas the general audience and app consumers identify it as healthy and ethical.
TikTok’s rapid growth and popularity in the US helped to gain a substantial market share among other social media platforms such as Facebook, Google, and Instagram. Amid the current health crisis, the number of users in the country escalated significantly (Kaye, Chen, and Zeng, 2020). The quick rise of TikTok indicates high cognitive legitimacy since the app has already been taken-for-granted as a short-video sharing platform. The content and conception of other giant competitors differ from TikTok’s. The app provides short videos, ten to sixty minutes in length, making it distinct from Instagram, which is a photo-sharing social network. However, the threat of banning it might have weakened the company’s position as consumers doubt its future availability. In fact, many of them try to find ways to trick the system, while others are planning to move to alternative platforms beforehand. Thereby, so far cognitive legitimacy is high, but the persistent trend may change in the opposite direction in the face of potential prohibition.
In a nutshell, Trump’s accusation of domestic safety peril with respect to the China-owned company TikTok damages its legitimacy status. LBV aids in the analysis of the political risk involved in the app’s operations in the US. Its pragmatic legitimacy has been diminished by the government due to censorship policies, albeit the public thinks otherwise. The moral element also divides them into two contrary sides with American citizens concerned with the abuse of their constitutional rights. Lastly, cognitive legitimacy remains to be the steadiest component with reference to TikTok’s recognition in the market.
Anderson, K. E. (2020) ‘Getting acquainted with social networks and apps: it is time to talk about TikTok’, Library Hi Tech News, 37(4), pp. 7-12.
Charpin, R., Powell, E. E., and Roth, A. V. (2020) ‘The influence of perceived host country political risk on foreign subunits’ supplier development strategies’, Journal of Operations Management, pp. 1-31.
Kaye, D., Chen, X., and Zeng, J. (2020) ‘The co-evolution of two Chinese mobile short video apps: parallel platformization of Douyin and TikTok’, Mobile Media & Communication, pp. 1-25.
Koleson, J. (2020) ‘TikTok is on the clock, will democracy stop?’, SLU Law Journal, pp. 1-7.
Wang, J. (2020) ‘From banning to regulating TikTok: addressing concerns of national security, privacy, and online harms’, Platforms, Governance, and Global Society (PGG).
Wang, Y. (2020) ‘Humor and camera view on mobile short-form video apps inﬂuence user experience and technology-adoption intent, an example of TikTok (DouYin)’, Computers in Human Behavior, pp. 1-9.
Weimann, G. and Masri, N. (2020) ‘Research Note: spreading Hate on TikTok’, Studies in Conflict & Terrorism, pp. 1-14.
Stevens, C. E. and Newenham-Kahindi, A. (2016) ‘Legitimacy spillovers and political risk: the case of FDI in the east African community’, Global Strategy Journal, 7(1), pp. 10-35.