Quick video app TikTok, owned by China’s ByteDance, mentioned on Thursday it might make investments billions of {dollars} in Southeast Asia over the subsequent few years, because it doubles down on the area amid intensifying international scrutiny over its knowledge safety.
Southeast Asia, a area with a collective inhabitants of 630 million – half of them below 30 – is one in all TikTok’s largest markets when it comes to person numbers, producing greater than 325 million guests to the app each month.
However the platform has but to translate the massive person base into a significant e-commerce income supply within the area because it faces fierce competitors from larger rivals of Sea’s (SE.N) Shopee, Alibaba’s (9988.HK) Lazada and GoTo’s (GOTO.JK) Tokopedia.
“We’re going to invest billions of dollars in Indonesia and Southeast Asia over the next few years,” TikTok CEO Shou Zi Chew mentioned at a discussion board it organised in Jakarta to spotlight the social and financial impression of the app within the area.
TikTok didn’t present an in depth breakdown of the spending plan, however mentioned it might put money into coaching, promoting and supporting small distributors seeking to be part of its e-commerce platform TikTok Store.
Chew mentioned content material on its platform was changing into extra diversified because it provides extra customers and expands past promoting into e-commerce, permitting shoppers to buy items by way of hyperlinks on the app throughout livestreaming.
TikTok has 8,000 staff in Southeast Asia, and a couple of million small distributors promoting their wares on its platform in Indonesia, the area’s largest financial system, he added.
E-commerce transactions throughout the area reached almost $100 billion final yr, with Indonesia accounting for $52 billion, in accordance with knowledge from consultancy Momentum Works.
TikTok facilitated $4.Four billion of transactions throughout Southeast Asia final yr, up from $600 million in 2021, however it nonetheless trailed far behind Shopee’s $48 billion of regional merchandise gross sales in 2022, Momentum Works mentioned.
TikTok’s funding plan comes because the Chinese language-owned firm faces scrutiny from some governments and regulators due to issues that Beijing might use the app to reap person knowledge or advance its pursuits.
International locations together with Britain and New Zealand have banned the app on authorities telephones, strikes TikTok mentioned it believed have been primarily based on “fundamental misconceptions” and pushed by wider geopolitics.
TikTok has repeatedly denied that it has ever shared knowledge with the Chinese language authorities and has mentioned the corporate wouldn’t achieve this if requested.
The app has not confronted main bans on authorities gadgets in Southeast Asia, however it has been below scrutiny over its content material.
Indonesia introduced one in all its first main international coverage challenges in 2018, after authorities briefly banned TikTok for posts they mentioned contained “pornography, inappropriate content and blasphemy.”
In Vietnam, regulators mentioned it might probe TikTok’s operations within the nation as a result of “toxic” content material on the platform poses a menace to its “youth, culture and tradition.”
