India banned usage of 59 apps of Chinese origin this past week. Out of the 59, the most popular ones are TikTok, ShareIt, Helo and Shein. India announced this in the aftermath of border skirmishes between the two countries with one violent clash mid-June resulting in 20 casualties on the Indian side and no verified information on the number of casualties on the Chinese side. India decided to ban these apps citing threat to the “sovereignty and integrity of India”.
Out of these 59, the most popular one was TikTok with nearly 119 million active users from India. Data shows that it was the world’s 4th most downloaded app (738 million times) in 2019, out of which 190 million was in India. The app allows users to upload short videos where they dance/lipsync/sing/perform skits etc. It is an outlet for artistic expression that brought people’s talent to centre stage like never before. Users connected with each other to collaborate on content and gained followers if their videos got appreciated. As the follower count grew, the influence a user couldwcould on their audience increased and this made it possible for some to earn by endorsing brands via their content. Millennials were the most active group on this app both in rural and urban areas – 66% of users are younger than 30. The app also saw many users from the hinterlands of the country for whom this talent showcase opened up a whole new world.
While many have welcomed the move by the Indian government, some have vociferously voiced their dissent and cited the reason that this will hurt the earning potential for many Tik Tok influencers. Let’s see if these objections hold good by a detailed analysis.
Influencers and TikTok Advertisements
TikTok never actually paid anyone on its platform. When a user has a large number of followers, they could tie up with brands and do content for them in order to popularize the brand among their followers. The platform did not enable an exchange for influencers and brands. Once some users became popular through Tik Tok, they could also do gigs offline and earn. Some users start Youtube channels and earned via ad revenue there by posting their TikTok videos or other content they develop. TikTok empowered influencers to earn but only by the use of their own enterprise.
TikTok the platform, however, earned well because they had highly engaged audience that was regular and consistent in the time they spent. Conservative estimates put Indians spending an average of 38 minutes on the app everyday! This meant that TikTok as an ad platform was irresistible to brands. TikTok offered many Advertising options like in-feed videos, branded effects such as AR filters and branded lens and the most popular hashtag challenges. Brands that target millennials – FMCG Brands like Pepsi, Britannia, new age startups like OYO, Paytm etc – were big spenders on the app. The app earned an estimated revenue of INR 25 crores in the Oct-Dec 2019 quarter and was expecting to more than quadruple that in the third quarter of 2020.
An Economic Times Report estimates that only about 100 creators were making big bucks via branded content on TikTok. While Instagram and Youtube both have in excess of 10,000 influencers each earning via ad revenue and affiliate marketing, TikTok influencers did not have an organized structure on the app to get Brand connects. Only the most enterprising ones were able to get noticed by Brands for content promotions.
Artistic Expression vs Pressures of Popularity
The success of TikTok lies in the fact that it allowed just about anyone with a smartphone to become a star! Talent was not a pre-requisite. Although the majority of the content was lipsyncing to tunes and dialogues from pop culture, the app did offer unlimited creative potential. People from the hinterlands of India were able to get thousands and millions of followers that cheered them everyday to act/dance/perform. They gained popularity like they had never even dreamt of. This kind of sudden stardom did not come without pitfalls. Many users suffered from FOMO and their day was made or broken by the Likes they got for their uploads. Some users faced trolling of the harshest kind when their content was released on other channels without their knowledge. Love affairs forged on the basis of familiarity the app bred among its users have broken families.
The app was also criticized for not taking users’ security concerns seriously. The platform allowed users as young as 13 to open an account but failed to provide any child safety features. Location tagging was also a potential threat for privacy. The addictive nature of the app meant that teenagers were spending way too much time on their devices. In fact, in early 2020, the US government had fined TikTok to the tune of 5.7 million USD for collecting personal information like email address and pictures from children, violating the country’s Child Privacy Laws.
Security & Privacy Concerns
TikTok is owned by a Chinese company called ByteDance which is a Social Media giant in China owning several platforms and valued at 75 billion USD. While most Social Media apps gather user data and use it for Ad targeting, the lack of transparency in Chinese owned apps and their data usage policies is what is concerning about TikTok and other apps.
The app also has had several complaints of nudity, explicit sexual content and violent content being uploaded. In December 2019, the US Army and Navy banned TikTok from all government issued devices over national security concerns. India too had raised these concerns earlier and ByteDance had promised that user data would be stored in India. However, that hadn’t happened and it is a known fact that the Chinese government could summon user data from companies if the data is stored in Chinese servers. TikTok has also been accused in the US of following a censor policy that is friendly to the Communist Party in China.
While it is true that banning a few apps cannot tip the scale towards India in the on-going border dispute with China, India’s strong stance has helped improve its image on the world stage by asserting its sovereignty. The move is aimed as a sentiment indicator and more and more Chinese businesses will come under pressure from user fallout in India. As the clamour for #BoycottChina grows louder, Indian made products and services will find more takers. New projects involving Chinese participation are likely to get shelved and this would certainly hurt Chinese business interests in the medium to long term. As Sun Tzu said in his Art of War, “To fight and conquer in all our battles is not supreme excellence; supreme excellence consists in breaking the enemy’s resistance without fighting”.
What Next for Content Creators?
Social Media platforms come and go but content lives on. Content creators will find other channels.
This has been proven true already by a sudden surge in downloads witnessed by homegrown social media apps like ShareChat, Chingari and Trell. Chingari has already seen 10 million downloads and its videos are garnering 10 lakh views every 30 minutes. The platform has also promised users to building a tool that will allow them to migrate their TikTok videos on to their platform without much hassle.
The ban on China made apps has opened up a huge opportunity for Indian techies to build user friendly, engagement rich platforms that can also offer advertisers the targeted audience they covet. But the user interface for the India-made apps are not as user-friendly as TikTok or other evolved Chinese apps and it remains to be seen whether the desi app makers can quickly adapt and ramp up their products to retain users and advertisers.