TikTok, an application for short videos, which is part of the ownership structure of the Chinese company ByteDance, on Thursday, June 15, announced its intention to invest billions of dollars in Southeast Asia over the next few years.
Currently, the popular application is focused on achieving the goal of strengthening its influence in the southeastern region. These efforts are being implemented at a time of tightening control measures over the security of media platforms’ data at the global level.
Southeast Asia is a region with a total population of 630 million people. Half of this population consists of persons whose age does not exceed 30 years. This region is one of the largest markets for TikTok. In the countries located in this geographical area, the monthly number of users of the application exceeds 325 million people.
At the same time, TikTok has yet to make efforts to ensure that Southeast Asia becomes one of its main spaces of income within the framework of e-commerce. In this region, the application faces fierce competition from Sea Shopee, Alibaba Lazada, and GoTo Tokopedia.
TikTok CEO Shou Zi Chew at a forum organized in Jakarta announced his intention to provide funding in the amount of several billion dollars in order to strengthen the position of the virtual platform in Southeast Asia and Indonesia over the next few years. This forum was organized to symbolize the social and economic impact of the application in the region in a sense.
TikTok has not yet shared the details of the investment plan. At the same time, the company announced its intention to finance training, a support program for small suppliers who want to start interacting with the application in the context of commercial activities, and advertising.
Chew says that the content of materials published on the virtual platform is becoming more diverse as the number of users increases and going beyond advertising into e-commerce. Users of the application have the opportunity to buy products from links on the platform during live broadcasts.
Currently, 8 thousand TikTok employees work in Southeast Asia. In Indonesia, the largest economy in the region, 2 million small sellers offer their products in the app.
Data from the consulting company Momentum Works indicate that in 2022, the volume of e-commerce transactions in the Asia-Pacific region amounted to almost $100 billion. Indonesia accounts for about half of this amount.
Momentum Works data also states that TikTok secured $4.4 billion worth of transactions across Southeast Asia last year. A year earlier, this figure was equal to $600 million. At the same time, Shopee’s sales in this region in 2022 amounted to $48 billion.
TikTok’s investment plan, according to experts, is partly a response measure against the background of close attention from some governments and regulators, who fear that the application can be used as a tool to promote China’s interests and as a platform for collecting personal data of users for certain purposes of official Beijing.
Some countries, including the UK and New Zealand, have banned the installation of TikTok on government smartphones. Representatives of the virtual platform claim that these decisions are the result of fundamental misconceptions and certain geopolitical realities.
TikTok has repeatedly stated that it has never transferred user data to the Chinese government and would not implement such a practice if requested.
The use of the application on government devices in Southeast Asia is not limited, but in this case, regulators closely monitor the content of content published on the digital platform.
Indonesia briefly banned TikTok in 2018 due to the presence of publications in the application, which, according to local authorities, contained inappropriate materials that violate moral and ethical norms.
In Vietnam, regulators intend to check the activities of the virtual platform, because, according to them, content that poses a threat to youth, culture, and traditions is published here.
As we have reported earlier, TikTok Tests AI-Powered Chatbot.
Serhii Mikhailov
Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.
