Google and Facebook are both feeling the heat from the new kid on the block, TikTok. Last week, a leaked audio clip from a Facebook internal meeting made media rounds. In the leaked audio, Zuckerberg responded to an employee's questions about the rise of Tik Tok, and he laid out Facebook's competing product Lasso's plans to enter markets TikTok has yet to dominate. This week, WSJ reported that Google has held discussions about acquiring the video-sharing startup, Firework, to counter fast-growing TikTok. The question begs: what is TikTok, and why should we care?
TikTok is the subsidiary of Bytedance, Beijing-based internet technology company currently valued at $75 Billion. TikTok's Chinese counterpart, Douyin, is the hottest social app du jour in China and its in-app conversion capability can put Instagram's e-commerce functionality to tears. Bytedance's other crown jewel within the family is Toutiao, an AI-driven news recommendation app that is the equivalent of Apple news + Google News and all other news distribution channels combined. Bytedance has recently announced it will be entering the search space, an area that "China's Google," Baidu, has dominated for the past decade or so. Bytedance is also eyeing the global market with wide ambition and TikTok has moved quickly to enter overseas markets. What's interesting about TikTok's overseas expansion strategy is how the app tailors in-market strategy based on individual countries' consumer preferences and social norms. TikTok's U.S. strategy is focused on the tween demographics, and it has captured a significant market share in a short amount of time, drawing scrutiny from media such as the New Yorker and legislators alike. Nevertheless, the firm marches on as we become more glued to our phones. In 1996, when the internet was termed "the web," the visionaries probably predicted that 20 years later, we'd all be trapped and unable to leave.
The battle for attention has shifted from words to video form. The robustness of the underlining recommendation logic and ability to keep a captive audience for as long as possible within the platform ecosystem are key in winning in this new competitive environment. Content creators and marketers are betting on story-telling in short-form video format. Instagram, Snapchat and TikTok have pioneered a verticle frame aesthetic, which Firework aims to "disrupt" by advocating for a horizontal, 30 seconds canvas to support higher production value video clips. We shall wait, likely not for long--if our attention span is an accurate predictor-- and see who will soon win out.
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