TikTok Lost Half a Million Daily Users After Pompeo Suggested Trump Wanted Ban

TikTok lost more than 500,000 daily active users after Secretary of State Mike Pompeo teased in the summer that President Donald Trump was considering a ban.

The figure was revealed in court filings on Wednesday as the Chinese-owned company appealed to a U.S. judge to grant an injunction against a Trump administration order that could see the app removed from Apple and Google stores in the U.S. Sunday.

In its submission, TikTok said the Department of Commerce "ignored evidence" and the administration's move was "not motivated by a genuine national security concern, but rather by political considerations relating to the upcoming general election."

Due to ongoing negotiations about a partial takeover with software company Oracle and retail giant Walmart, the Department of Commerce delayed restrictions against TikTok by a week, moving the start date from September 20 to September 27.

Vanessa Pappas, TikTok's interim global head, said in a separate legal filing that even before the department's order the app was facing "intense competitive pressure."

The executive wrote in a declaration: "When Secretary of State Pompeo first announced that President Trump was considering a ban of TikTok, we saw a significant drop in our user base, with a reduction of over 500,000 daily active users."

In July, Pompeo said the government was "looking at" TikTok, fueling speculation that it was about to be banned. Citing security concerns, officials from the administration then threatened to outlaw the app unless it was sold to an American firm.

After talks with Microsoft ultimately fell through, a deal with Oracle and Walmart was given "tentative approval" by the government, with the firms acquiring 20 percent of a newly-formed company, TikTok Global. But the situation remains complex.

Imminent restrictions on TikTok by the U.S.—which say the app could still be banned by November—continue to loom over the business negotiations.

President Trump said on Monday that he would not approve the terms if ByteDance, the Chinese-based tech firm that owns the TikTok, maintains any control. Chinese state media blasted the deal in an article yesterday as being "dirty and unfair."

It remains unclear how the new company would be structured, who will oversee major decision-making, and how much access will be given over its algorithms.

TikTok and ByteDance have repeatedly denied being a risk to U.S. security and rejected the suggestion its Chinese ownership poses a threat to the data of Americans.

"We have never provided user data to the Chinese government, nor would we do so if asked," a TikTok spokesperson said in a statement released back in July.

Painting a dire picture, Pappas said in the filing that removing TikTok from app stores would have consequences for its long-term business, including the ability to recruit staff in the U.S. and its likelihood of retaining content creators from competitors.

"As soon as TikTok is removed... our competitors will have a window to entice TikTok creators to switch platforms and to knock TikTok out of the market," she wrote.

The executive said when rumors of a ban started to spread online, the app was adding roughly 424,000 new daily U.S. users each day. If the full ban in November is allowed to go ahead, Pappas said erosion of its position would "significantly accelerate."

She wrote: "Our modeling indicates that 40–50 percent of our daily active users before the... TikTok ban will not return to TikTok even if the ban is lifted after two months; if the ban is in place for six months, 80–90 percent of daily active users will not return.

"Accordingly, even if the TikTok ban is later lifted, we would not be able to make up for lost ground, because people who would have downloaded TikTok will have already turned to other competing platforms... to fill the void left behind."

Newsweek has contacted the White House for comment.

A man holding a smartphone casts a shadow as he walks past an advertisement for social media company TikTok on September 21, 2020 in Berlin, Germany. U.S. President Donald Trump has given preliminary approval for Oracle, Walmart and other investors to take over TikTok and create a new U.S.-based company called TikTok Global. Sean Gallup/Getty