TikTok will be the richest prize in media if the ban bill passes, says The Verge Editor-in-Chief

All right, let’s talk more now about this. Joining us, Raymond James Washington policy analyst Ed Mills had a great note out on this morning and The Verge editor in chief and CNBC contributor Nalay Patel. Nalay, I want to kick it off with you. OK, So this is a little weird. According to prediction market Kalshi, right, We can bet on stuff. Current odds are that this bill, the ban bill has a 97% chance of passing. But in terms of the odds of the app, of the app actually shutting down or getting banned, 88% of Kalashi better say TikTok will not be banned in America this year. Can you square those things for us? I can’t. I, I can give it a shot. I don’t know, ’cause she’s going to say about how well I’m going to do, but I can give it a shot. Biden’s not going to veto this bill, right? Vetoing this bill means vetoing aid for Ukraine and Israel, which I don’t think he’s likely to do. That’s why it’s being packaged up in this bill. So it’s going to pass. If the bill passes tomorrow, I expect it will be passed by dinner time tomorrow. Biden will sign the bill. We’ll enter into that nine month to a year period where TikTok becomes one of the richest prizes in all of tech in media, right? It is a scaled social platform that both Meta and Google in terms of YouTube are deeply afraid of. There are a lot of players that would love to compete for the dollars that Meta and Google can pull from their social platforms and have no way of scaling their way to do it. So you can see just the ecosystem of players that will either try to raise money to to buy TikTok that might have the money themselves in terms of Microsoft or even Apple, which seems like a long shot, or try to syndicate the money. You can see a snap try to build a syndicate to buy TikTok. So there’s a lot of players that see this prize and Ed Millay nailed it. He he put it in a political way where this was stuck for bizarrely stuffed into a funding bill for things the president really, really wants, primarily more funding for Ukraine. So the president cannot veto this bill. I would imagine that was part of the strategy for those who are looking to shut down or force a sale of TikTok. Yeah. So in DC, things seem impossible right up until the moment it’s inevitable. And so once this was added on to the bills last week, this becomes inevitable. To your question on whether or not it’s happening this year or next year, I probably take next year. There will be legal challenges to this, Brian. But when you read the text of the bill, what’s really interesting is they don’t want Tick Tock to have the ability to judicial shop this around and get a favorable judge. Congress is judicial shopping and putting it in the DC Circuit Court of Appeals, the most likely court to side with Congress, to side with the president and allow this force divestiture to go forward. And what Raymond James clients are asking me is will China allow this? I know there’s a lot of potential buyers out there. This is a really great property. But if you give that algorithm to AUS based corporation, then we’re going to get to see exactly what they’re going to do with it. It’s not so much about the news stories we’re seeing, but it is the collection of personally identifiable information. It is the building out of a LLMAI model with that data. There is a number of national security concerns here that makes it very likely, in my opinion, come next year, TikTok as we know it will not operate here in the United States. In LA. It’s an excellent point. Again, do you agree with that? Like China, you can’t force them to sell anything. They could just shut it down because my guess is, to Ed’s point, they don’t really want you to know what’s under the hood here. Yeah, you know, trying to invite dance. They’ve had this deal with Oracle for quite some time. Project Texas, It turns out Project Texas is kind of a sham, right? I mean, that’s all the reporting that’s come out recently. I think what’s more likely is they say, OK, you can have the user base, you can have the data. We’re going to keep the recommendation algorithm to ourselves. There are only a handful of things that overcome the 1st Amendment in this country. Pornography is one of them. The things that Congress can can legislate and regulate directly, there’s a really small handful of things foreign media ownership is actually one of them. We have rules in this country about how much media foreign countries are able to own. We actually have rules about how much anyone citizen is able to concentration of media ownership also a a threat to democracy in this country long since recognized. So I think you’re going to see those challenges. You’ll hear bite Dance, make a lot of noise about the 1st Amendment and you’re going to see Congress and the government say, look, there are long standing rules about foreign media ownership in this country. This is the most important media we have going. We’re just gonna apply the rule.