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, and has put more than 250 jobs at risk, the company said in a court filing seen.
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 start-ups potentially worth around $75 billion, was considering a public listing in Hong Kong this year, sources said in August.
The ban has also worried the social media industry in India as it sees legal worries mounting if courts increasingly regulate content on their platforms. In the filing made to India’s Supreme Court on Saturday, 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 effected 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.