Implications of potential WeChat and TikTok ban in the USA


Chinese apps such as TikTok and WeChat could be banned in the USA in the same vein as they were banned in India. According to the (TechCrunch), the U.S. Commerce Department has agreed to ban of TikTok and WeChat apps in U.S. app stores starting from September 20, in order to combat China’s malicious collection of American citizens’ personal data” (BBC).

That being said, a US Judge said the ban raised serious questions related to the constitution’s first amendment, guaranteeing free speech and blocked the U.S. Commerce Department’s attempt to ban WeChat (BBC).

Whereas, TikTok’s ban in the United States has been delayed for a week (SearchEngineJournal), and a deal with Oracle and Walmart is yet to be decided on the future ownership of the app.(TechCrunch)

As more trade conflicts pile up between the USA and China, many such cases might be the new normal while permanently jeopardizing Chinese app market share in the USA.

Therefore, analyzing WeChat and TikTok App’s usage trend via monthly active users data and rate of activity could provide apps’ current trend and even future outcome.

WeChat (MAU)

With having nearly 2 million monthly active users earlier this year, the MAU chart data of WeChat in the USA taken from App Ape shows a declining trend of its user base.

The negative growth trend since May this year, may be a direct result of degrading relations between the USA and China and even increasing privacy concerns among users from using Chinese apps.

TikTok (MAU)

On the other hand, the monthly active user growth for TikTok has been steadily increasing over the past few months as the number of MAU is currently hovering close to 20 million monthly active users.

The app’s growth trend might shift drastically, depending on how TikTok USA will be handled in the coming weeks.

Rate of Activity

The rate of activity, which consists of ratio of DAU and MAU over possession, can paint an accurate picture on app’s daily and monthly usage behavior.

The below pie chart of WeChat and TikTok, taken from App Ape contains D to D % and M to M %. Both of these ratios have seen a measurable drop in the respective apps’ rate of activity.

As of Sept 24th, WeChat has endured a loss of -7.7% in daily and -3.1% in monthly rate of activity. Similarly, TikTok has also endured loss in the rate of activity but not as significant as WeChat, with -0.3% in daily and -0.2% in monthly rate of activity.

The implications of an all out ban could be devastating for the Chinese made apps but the lack of trust can have spillover effects. Because they can get replaced by other non-Chinese apps, within the matter of days of getting banned just as they have been in India. In that case, the Chinese developers will not only have to fight against the US government in order to operate in the US territories, but they will also likely have to compete with more developers trying to snatch away any remaining market share.

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