China’s Bytedance Says India TikTok Ban Causing $500,000 Daily Loss, Risks Jobs

The logo of TikTok application is seen on a screen in this picture illustration taken on Feb. 21, 2019. (Danish Siddiqui/Reuters)

NEW DELHI–India’s ban on popular Chinese video app TikTok is resulting in “financial losses” of up to $500,000 a day for its developer, Beijing Bytedance Technology Co Ltd., and has put more than 250 jobs at risk, the company said in a court filing seen by Reuters.

TikTok allows users to create and share short videos with special effects and is one of the world’s most popular apps. It has been downloaded by nearly 300 million users so far in India, out of more than 1 billion downloads globally, according to analytics firm Sensor Tower.

Earlier this month, an Indian state court ordered the federal government to prohibit its downloads, saying the app was encouraging pornography. Acting upon instructions from the federal IT ministry, Apple Inc., and Alphabet Inc.’s Google last week removed TikTok from their India app stores.

The developments have dealt a blow to the India growth plans of Bytedance, which is backed by Japan’s SoftBank Group Corp and by private equity. Bytedance, one of the world’s most valuable startups potentially worth around $75 billion, was considering a public listing in Hong Kong this year, sources told Reuters in August.

In the filing made to India’s Supreme Court on April 20, Bytedance urged the court to quash the ban and direct the federal IT ministry to tell companies such as Google and Apple to make the app available again on their platforms.

The court filing is not publicly available and its contents have not been previously reported.

Bytedance pegged financial losses at $500,000 each day, which it said includes destruction in the value of its investments and loss of commercial revenue. It added the ban would result in its reputation and goodwill taking a hit with both advertisers and investors.

“Banning has had adverse impact on the user base of this app, losing close to 1 million new users per day ... It is estimated that approximately six million requests for downloads could not be affected since the ban came into effect,” the company said in the filing.

A spokesman for TikTok and the federal IT ministry did not respond to requests for comment.

Court Battle, Content Woes

The Supreme Court has so far not provided any interim relief on repeated pleas by Bytedance and referred the case back to the court in southern Tamil Nadu state, where the case will next be heard on Wednesday.

Memes and music videos thrive on TikTok, although some clips show youngsters, some scantily clad, lip-syncing and dancing to popular tunes.

Its growing popularity has drawn criticism from some Indian politicians and parents who say its content is inappropriate. The Tamil Nadu court, which ruled against TikTok after an individual filed a public interest litigation, has said the app could also expose children to sexual predators.

The Supreme Court filing included a table in which Bytedance compared TikTok to Facebook, Instagram, and Twitter by listing 13 of its implemented safety features, including parental controls.

A BBC report found that TikTok’s method of dealing with inappropriate messages aimed at minors was to simply delete the post within 24 hours. Even though the app has rules against such forms of communication, many of the offending users were allowed to stay on the platform, the report said.

By Aditya Kalra and Munsif Vengattil. The Epoch Times contributed to this report.