Meta, Google stand to win ad share from TikTok ban
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Meta and Google are expected to be the biggest beneficiaries of a U.S. TikTok ban financially, according to a new analysis from eMarketer.
Why it matters: The growth of TikTok and retail giant Amazon has put real competitive pressure on Google and Meta, which for years have owned more than half of the U.S. advertising business.
Zoom in: If TikTok is banned, more than half of the ad dollars spent on the platform in the U.S. would go to Meta and Google-owned properties, eMarketer projects.
- Instagram and Facebook would take 22.% and 17.1% of TikTok's reallocated ad spend, respectively. Google's YouTube would take roughly 10.7%.
- Other social media platforms would also stand to benefit. Snapchat, Linkedin, Pinterest, Reddit and X would collectively take roughly 18.3% of reallocated TikTok ad spend. Some of those platforms have already begun to restructure their apps around their own TikTok-like short video products.
- Connected TV companies, or streamers, and other digital media companies across social, search and retail advertising would collect roughly 30% of reallocated ad dollars.
Zoom out: Companies like Meta and Google have invested heavily in their TikTok rival products, Reels and Shorts, positioning them well to take advantage of a possible ban.
- Meta CEO Mark Zuckerberg told investors last year that Reels alone makes up more than 50% of user time spent on Instagram.
- Google said last year that over 2 billion logged-in monthly users are watching YouTube Shorts.
Of note: eMarketer expects that advertising dollars will get reallocated immediately after a ban, as marketers have had many months to figure out alternative plans.
What to watch: For now, the ban seems likely, and the Supreme Court's arguments Friday led court watchers to expect it will uphold the ban law.
- China has indicated for months that it wouldn't let ByteDance sell TikTok to a U.S. company to skirt a ban.
Yes, but: A Bloomberg report out Monday suggests Chinese officials are eyeing a possible deal to sell TikTok to Elon Musk.
- If that were the case, Musk and X would likely stand to benefit enormously from the entire saga.
- TikTok is denying the report.
Go deeper: What will happen to TikTok on Jan. 19
