It's been a year since Chinese social media giant Bytedance relaunched its super-popular app Musica.ly as Tiktok; the company is now valued at $75b, and in the USA it has become a serious challenge to US-based social media companies, courting a young audience (so young that it's getting into legal hot water over it).
Tiktok spend $1b last year advertising in the USA, and this year it's on track to surpass that figure, with $3m/day in US ad spending. It has the power to change music trends, and has been credited with the record-breaking success of Lil Nas X's "Old Town Road," the longest run at the top of the Billboard single chart in history.
The company is aggressively hiring US execs, too.
But Tiktok's US rise has geopolitical implications. In China, Tiktok has been suborned to serve as a state propaganda outlet, serving anti-Hong-Kong-uprising memes to Chinese users, including conspiracy theories blaming the Hong Kong protests on US agitators (other Chinese social media companies have been serving similar content). The propaganda efforts are also intense in Xinjiang, a region where the Uighur ethnic minority have been subject to mass surveillance and torture in "re-education" camps.
After a run-in with Chinese state regulators, Bytedance has pledged to hire 10,000 censors to identify and block anti-government content.
But the company also faces some real risks in the near future. Here are four:
One, TikTok has to fix its funnel. Too many people try TikTok, use it a few times, and never return. We saw something happen similar with Twitter years ago. The app developed universal awareness among Americans, but most who downloaded Twitter abandoned it shortly thereafter. With TikTok spending $3 million a day on ads in the United States, it could become a household name in short order. But if it can't sustain users' interest, it could find itself mired in the same trough of despair that Twitter has been in for most of its life.
Two, TikTok has to keep shipping hits. Every social app is, on some level, a fad, and those that don't evolve are doomed to fade away. (See Vine or, more recently, HQ Trivia.) Any novel social app can have a good year — it remains to be seen to what extent TikTok's video feed has staying power. Something to watch closely: what new features does TikTok launch in the next 12 months? Both Vine and HQ felt novel at launch but never meaningfully iterated on their core experience; Snapchat survived by following up its original hit (disappearing messages) with something even bigger (ephemeral stories.) If TikTok is going to survive, it has to be less like Vine and more like Snap.
How TikTok could fail [Casey Newton/The Verge]