'I'll be real with you guys. I don't use TikTok all that much. Now it's mostly a self-control thing. Like, I know I'll spend hours just scrolling and scrolling if I open it. The algorithm is uniquely addictive, but it's not like I don't see Tiktoks out in the world. There are my group chats. They get reposted elsewhere, not to mention all the IRL conversations I have that start with some form of Hey, did you see that one? Tik tok? This is all to say the app is an incredibly influential part of culture, especially with Gen Z. It's also super popular. A billion monthly users worldwide, more than 170 million in the U.S.. So what would happen if this platform were to just go away? If app stores could be fined just for hosting it? Well, as of now, that very scenario will come to pass later this month, January 19th, unless the US Supreme Court steps in. And on Friday, the justices will hear the case. My guest is Clare Duffy. She's a CNN business reporter and host of the CNN podcast Terms of Service. We're going to break down how we got here, the strategy both sides will bring to oral arguments and how creators are preparing for a potentially less lucrative post tick tock future. From CNN. This is one thing. I'm David Wright. So, Clare, you cover business and technology, and I'm going to briefly ask you to become a legal eagle in a second. But before we get there, can you remind us how we got to this point where TiKTok is basically fighting for its life at the Supreme Court?

Yeah. So this goes all the way back to Trump's first presidency to 2020. And there had long been concerns that the app was a national security risk because its parent company, Bytedance, is based in China. And the worry was that it could abuse U.S. user data. It could covertly spread Chinese propaganda through the Tik Tok algorithm. So there starts to be this conversation about how do we manage this risk?

And here's the deal. I don't mind if whether it's Microsoft or somebody else, a big company, a secure company, very, very American company, buy it.

And there were talk of sales that the app could be sold to an American buyer in 2020. Walmart and Microsoft, A hilarious pair were prepared to partner up to buy it. And then Trump tries to ban the app through executive order. In August of 2020.

I set a date of around September 15th, at which point it's going to be out of business in the United States.

That order gave just 45 days for TikTok to find a new buyer. But that ends up getting knocked down in court on First Amendment grounds and nothing ends up coming of it. And I think it's worth noting that at that time, TikTok had become really popular really quickly during the pandemic. People were bored and it sort of transformed overnight from this silly dance app to much more than that, a place where people were having all kinds of conversations. And already in 2020, it had 100 million U.S. users. It now has about 170 million. But this became sort of an overnight sensation. And I think that's part of why there was so much focus on it so quickly is because it really started to become the center of the social media conversation. Whereas prior to that, the social media giants were all American tech companies, right?

So there was this concern that if an app getting this big this quickly had some connection to China that could be harmful to users data or national security, then this needs to be addressed and quickly.

Exactly. Yes. So Trump tries and fails to ban it and then he leaves office. Biden takes office. In the meantime, TikTok makes this effort to really sort of clean up its image and address some of these concerns. It starts engaging with the Committee on Foreign Investment in the United States, trying to figure out if there's a way for it to address these national security concerns without being banned or sold off. It changed the way that it handles U.S. user data. Partnered with Oracle to store U.S. user data here. It opened this transparency center in the U.S. to help people understand the app's algorithm and how it works. And yet people continue to call for this app to be banned.

This bill also protects Americans, especially our children, from the malign influence of the Chinese Communist Party controlled TikTok. This app is a spy balloon in Americans phones.

So then that takes us to early 2024. Congress tucks this measure into a foreign aid package that would ban TikTok from the U.S. app stores unless it finds a new owner within 270 days. So by January 19th, 2025.

Bytedance ownership of TikTok is a threat to the security of the United States.

This passes by a huge bipartisan margin, in part because it's tucked into this larger package and Biden signed it into law. Then the countdown is on.

Tiktok's parent company, Bytedance, is 270 days, which is nine months to essentially spin off their US business.

TikTok all this time has said that it is not. You know, Bytedance has no interest in selling. Tick tock tick Tock has not shown any interest in finding a new buyer. So tick Tock goes then to court and it says the law is unconstitutional and infringes on its free speech. On the free speech of its 170 million American users.

Some breaking news now on Tiktok's future in the US.

But in December, the D.C. appeals court basically said the law is fine. It upheld the law. It said the government had met the strict scrutiny required to crack down on American speech by banning this kind of app. So then the countdown is still on.

So the Supreme Court has just added a major case to its docket this term, agreeing to hear arguments over that law that could ban TikTok.

It's a law. TikTok appeals to the Supreme Court, and the court agrees to hear the case. And that is going to happen on Friday, just nine days before the ban deadline.

Wow. So that brings us to the oral arguments scheduled for Friday. I want to drill down a little deeper on the arguments both sides will be outlining here. So can we start with the anti TikTok side? What is the case to ban Tik Tok?

Yeah. So Biden officials have called it a grave threat. And there's sort of two things that people will talk about here in terms of their concerns around tick tock. One of them is about the app's collection of U.S. user data collects like a lot of social media apps collect things like location, data, browsing, history. You know, you can see what users have viewed, what users have posted. And the concern was that that data could potentially be accessed by the Chinese government.

Because it is owned by this company in China.

Yes, because it is owned by this Beijing based company that the Chinese government could essentially force bytedance to hand over that U.S. user data and it could be used for surveillance or espionage. There are also concerns that the Chinese government could force Tik Tok to include certain content in the for you feed or that they could force changes to the algorithm in a way that could spread Chinese profit.

Like if I'm scrolling through, I just might randomly see some subtle messages of Chinese propaganda or something like that. Might not even realize it, but it's still coming through the feed.

Exactly. And you could see how that could be potentially harmful in terms of crisis or in terms of political discord, where if if the Chinese government is somehow forcing TikTok to include a certain point of view or highlight a certain point of view in its algorithm, that that continues to sort of pull Americans farther apart? I think that's really the concern there.

But I guess the question is, is any of that actually happening?

So we haven't actually seen any evidence from the U.S. government that that is happening. And, of course, TikTok says that it would never hand over U.S.. User data to the Chinese government. It has not been asked to. It now stores that data in the U.S. So Tik Tok is firmly pushed back on all of these claims. And so far, you know, experts say it really is just a hypothetical from the U.S. government's perspective. It's something that maybe could happen, but we haven't seen any evidence that it actually has.

Well, so what about Tiktok's case then? Why does it say it should continue operating as it has been?

Tik Tok says this law, this ban would be a violation of the First Amendment. It says that 170 million Americans use this app, including for things like political speech. And Tik Tok says that the U.S. government shouldn't be cracking down on that kind of speech. Like it's.

Not just cat memes and stuff like they're serious political speech that could just be wiped out if the app were to go.

Away. Exactly. I want to read just a portion of Tiktok's petition to the Supreme Court because they really do not mince words here. They say the government concedes that it did so that it tried to ban Tik Tok, partly because of the fear that the platform's American publisher could be indirectly pressured by China to alter the mix of content to influence American minds. That justification is at war with the First Amendment, they say. So they're really they're really calling out the government here and saying, just because you don't like some content that might be on our app doesn't mean that you can ban the app entirely. I will say, too, that TikTok pushes back even on the idea that it is owned by a Chinese company. Bytedance is incorporated in the Cayman Islands. It's headquartered in Beijing, but it's incorporated in the Cayman Islands. And the company says no arm of the Chinese government owns, directly or indirectly any share in Tik Tok or buy dance. So it really sort of pushes back on the most basic point of this, that it is somehow connected to the Chinese government.

Well. So we don't know how the justices will come down here, obviously. But what are the possible range of outcomes here?

Well, so first, the justices could uphold the law. They could say these national security concerns outweigh the First Amendment concerns. The law is okay.

On January 19th, law goes into effect.

January 19th, law goes into effect. That would be a pretty quick decision for them to make in between January 10th when this hearing is going to happen on January 19th when the ban goes into effect. So I think the most likely path is that the Supreme Court holds these oral arguments and then implements a stay on the law to give them a bit more time, essentially pauses the law going into effect on the 19th so they have a bit more time to consider the actual legal arguments here. And then, of course, the Supreme Court could side with tick tock and block the law from going into effect. And then I think you have a situation where it's likely that we will hear members of Congress talking about another way to go about this, because there are still very much these concerns about national security. But if the Supreme Court finds that this law is unconstitutional, then they might look for another way to go about it.

Well, how does President elect Donald Trump factor into all this? Because January 19th is when the ban is supposed to take effect. Trump takes office one day later. We talked about how Trump tried to ban it when he was in office in 2020. Now he wants to save it. And he claims he has become very, very popular on the app. It's not clear, like to what extent that is actually true, but is there anything he can actually do to save it? If the Supreme Court says, no, this can go forward?

Yeah, it is really interesting that he's made the sort of 180 in terms of his his thinking about the platform. And I do think his popularity on TikTok since he launched his account over the summer and the way that that played into potentially his election run.

We're on TikTok, what is your message to younger voters right now?

Well, the big message is vote for Trump. We're going to make our country greater than ever before.

Which has a lot to do with why he is now saying he's going to save Tick tock. He over the summer said, if you want to save tick tock, vote for me for president.

And you'll never ban TikTok...

That's for sure. I will never ban. Thank you.

But it's not clear like what he is going to be able to do if this law does go into effect the day before his inauguration. He has filed a legal brief to the Supreme Court, sort of siding with TikTok, asking the court to delay the date that this would go into effect so he can be the one to find a solution to this. And again, this filing is pretty hilarious. It's very Trumpian. He says President Trump alone possesses the consummate deal making expertise, the electoral mandate and the political will to negotiate a resolution to save the platform while addressing national security concerns. So he wants to be the one to take care of this. If the law does go into effect on the 19th, he would be in a position where essentially he's going to have to ask Congress to repeal the law, which I think is pretty unlikely because they just passed it less than a year ago. So that would be embarrassing for them, I think. He also potentially could say that he's not going to enforce the law. He could direct his attorney general not to enforce the law, which that, you know, then could mean that the app stores could decide essentially to violate the letter of the law and continue to allow tech talk on their platform because they're really the ones that are on the hook. They could face fines under this law if they continue to host. Tick tock.

Right. The law is kind of directed at these places that host the platform for all of the rest of us. And in theory, they could just say this law, we're kind of ignoring it. We're going to let TikTok stand up on the app store and have fun, everybody.

Exactly. But then the question is, if you are the general counsel of Apple or Google, are you really going to want to violate the law and potentially give President Trump, who we know is somewhat mercurial? The leverage, you know, the opportunity where he could then change his mind and come after you at some later date. The app stores might decide not to play ball with that. The final option for him is that the law does give the sitting president the sort of power to decide if a divestiture of a sale of TikTok has happened. And legal experts have told me that he could essentially say, yes, this has been divested. It's all good, even if that actually hasn't happened. And it would be really tricky for anybody to challenge that in court. But again, sort of unclear if any of those pathways would work out.

So I guess the bigger question is why doesn't tick tock, just find a new buyer and get itself in compliance with the law and then we wouldn't have to talk about any of this.

Yeah, it is. It's funny that for four years we've been talking about it and but they have shown no no interest really in finding a buyer. And you can sort of understand why, like Bytedance doesn't want to lose the U.S. arm of tech talk. This is a company that has worldwide a billion users. And the U.S. is just 170 million of those. But you want to be playing ball in the big leagues with the Facebooks and Instagrams and Snapchats of the world. They don't want to lose the sort of crown jewel that is U.S. TikTok. There's also this sort of interesting wrinkle in that China passed a law that says that you can't export certain technologies without a license. And the assumption is that that includes the tech talk algorithm. So potentially you could be in a position where even if Biden said, okay, we're going to sell off the U.S. arm of TikTok, it couldn't include the algorithm, which is really TikTok's special sauce. That's why it's so popular. It's why it's really different from the other apps. And so in that case, it might be tricky to find somebody who would be willing to shell out the billions of dollars to buy this platform. And sure, maybe you get the branding and the users, but you don't get the algorithm, which other platforms have tried to replicate and not really been very successful.

Right. Well, that kind of brings me to what social media and the Internet would look like if TikTok were to go away in the U.S. I'm thinking especially about the people who use it as a way to make money. Are there alternatives? These people can use it if it goes away? And how do they compare with the reach and influence of TikTok as it stands today?

Yeah, it's really interesting because I think people who maybe don't spend a lot of time on social media or thinking about this stuff, the response is often like, Well, we'll just go to another platform. There's plenty of other platforms. It's not that big of a deal. But Tik Tok is pretty unique. The algorithm works in this way where it prioritizes discovery of new kinds of content versus sort of feeding people's existing social connections or who they follow and what that means as it's really a lot easier for smaller creators, new creators to get discovered and build an audience quickly than it is, say, on Instagram or Facebook. And that's meant, you know, it's been a huge opportunity for people to build careers online. I talked to a couple of creators, including Elli Rollo.

I joined Tik Tok as a consumer first, so I was a senior in college. Now I would describe my Tik Tok content as comedy meets advice.

And Joanne Molinaro, who goes by the Korean Vegan on Tik Tok.

If the ban goes through. For me as a content creator on Tik Tok, what it would mean is completely losing the community that I have built on Tik Tok for the past few years. That community has taught me so much about what it means to not just be a content creator for them, but also to be a voice for them. Well, where are those people going to go? They'll go to Instagram reels or they'll go to YouTube. Okay, sure. But the interfaces that have been built by those particular platforms simply don't create the same kind of framework for community that Tik Tok has.

And they brought up the fact that, you know, the content that does well on Tik Tok is often pretty different from the content that does well on other platforms.

I have almost a million followers on TikTok and I have almost 200,000 on Instagram. Tik Tok always. It's the thing. It's the reason that brands want to work with me. I'm seeing five figure brand deals on Tik Tok regularly.

These are both creators who have built their their social media influencer careers on Tik Tok. They have a presence across all the social media platforms. But if you're somebody who really is good at creating Tik Tok content, it doesn't necessarily mean that that content is going to translate on Instagram or on Facebook and that those audiences are going to be looking for the same kinds of things. And if you're somebody who does brand deals, who brands pay you to promote their content and you have a big audience on Tik Tok and maybe smaller audiences elsewhere, if you're currently making a living from those TikTok brand deals, it also doesn't necessarily mean that those brands would follow you.

Tik Tok is not perfect, and that's not what I'm trying to say. And the algorithm does favor thinness and whiteness and wealth, and we know that. But the opportunities that Tik Tok has given to people who are historically underrepresented is insane compared to other apps. And the opportunity that Tik Tok has given small businesses is insane when compared to other apps.

You know, it seems like Tik Tok users are often a bit more supportive and interested in creativity and trying new things than on the existing older platforms where it's sort of like we know what works and you should stick to that.

Because I think of Tik Tok as my wild child, I get to be a little bit freer, more, you know, myself, I get to kind of take the the curation away from it and I just get to talk freely with them and have fun with them. And I think, you know, as a content creator, that sort of experience cannot be replicated simply by telling someone, We'll just go to the other ones.

There's sort of this seeking out of creativity and of something new on tech talk that I think is really unique.

For these other platforms. Is this a moment where they are like rooting for tick Tock to fall so they can kind of get some of these creators to come to them? Or do they see it as a moment that is perilous for free speech and just the way that these platforms are allowed to exist on the Internet?

It's a really interesting question because I think the American platforms do really stand to benefit of TikTok gets banned. I mean, this is a really this has become one of the most popular platforms, especially with young people. That's the cohort that all of these platforms really want to attract. And so if Tick tock goes away, that could mean really good things for meta, for YouTube, for Snapchat. But I think you're right that it is a bigger question about what does it say about free speech on the Internet. If the government can sort of come in and decide what you can and can't access? And and I think the American platforms are more or less safe because they are owned by American companies. And, you know, a big part of this is the sort of tech war between the U.S. and China, where the U.S. wants to make sure it's the leader in the technology space. And so I think the American platforms probably aren't so worried about it from that perspective. And it has been interesting to write because they haven't really spoke up, spoken up about this either way. They haven't said, yes, we're excited for TikTok to be banned because it'll be great for our users. They also haven't spoken up in support of TikTok. I think they're very much not wanting to be the target of the government's attention. So they're kind of staying out of it.

Right. But speaking of meta, they do seem to be cozying up to the new Trump administration in a variety of ways. And yesterday they announced this massive change to their content moderation policies, saying they're getting rid of human fact checkers and instead pivoting to community notes like you see on Elon Musk's X. CEO Mark Zuckerberg claimed the fact checkers have become too politically biased. At the same time, though, he acknowledged that more harmful content will appear on the platform as the result of the change. Experts say this is like a seismic shift. So between that and the TikTok case, a really big moment for tech right now. Of course, people should check out your podcast terms of service. You guys have an episode up right now digging even deeper into the Tik Tok case. Clare Duffy, thank you.

Thank you so much.

One thing is a production of CNN Audio. This episode was produced by Paola Ortiz and me, David Rind. Our senior producers are Felicia Patinkin and Faiz Jamil. Matt Dempsey is our production manager. Dan Dzula is our technical director and Steve Lickteig is the executive producer of CNN Audio. We get support from Haley Thomas, Alex Manasseri, Robert Mathers, John Dianora, Leni Steinhart, Jamus Andrest, Nichole Pessaru and Lisa Namerow. Special thanks to Graelyn Brashear, Wendy Brundage and Katie Hinman. I'll be back on Sunday with another episode. I will talk to you all then.