Challenges Faced by the Chinese Pension System
In the previous article, we have already studied about the peculiarities of the Chinese pension system. We are now aware that the Chinese pension system is quite different from the pension system operating in western countries. The fact that the Chinese system is different does not make it better than the western system. The Chinese […]
The Silicon Valley Bank Collapse: Why Is It Important?
In the second week of March 2023, the Silicon Valley Bank, which is headquartered in Santa Clara California collapsed in spectacular fashion. The shares of the bank fell by over 60% in one day. There was a classic run on the bank which led to a collapse almost overnight! This created a panic-like situation across […]
Impact of Technology on Sporting Finance
The sporting industry has undergone a lot of changes in the recent past. These changes have been related to various aspects of the sporting industry. However, technology has been the driving factor behind most of these changes. Technology has completely transformed the sporting industry and the impact of this transformation has also been felt in […]
What is a Financial Market
A market is a place where two parties are involved in transaction of goods and services in exchange of money. The two parties involved are: Buyer Seller In a market the buyer and seller comes on a common platform, where buyer purchases goods and services from the seller in exchange of money. What is a […]
Who Uses Accounting Data ?
Financial reporting is used by a wide variety of users for a wide variety of purposes. For this reason it has been difficult to set a common framework of accounting. The many stakeholders often have contrasting needs from accounting information. Let’s look at the stakeholders and their need for accounting data: Capital Markets: Accounting information […]
When we talk about social media, we often refer to companies like Facebook, Instagram, Twitter, and LinkedIn. However, in the past few years, another company has emerged as a huge player in the social media space. This company has created an application that is known for having high levels of user engagement. The application being talked about is TikTok.
TikTok has taken the world of social media by storm. This is because millions of people are using this application to create content. This application is very successful amongst the younger target audiences. As a result, Bytedance, the Chinese company which has created TikTok has become the most valuable start-up in the world. The company is valued at close to $280 billion.
However, despite its high levels of user engagement, TikTok seems like an application that is not meant for entertainment only. Most people around the world are not clear as to how TikTok generates revenue and how it has become one of the most valuable applications across the world.
In this article, we will explain the business model of TikTok which enables it to generate significant amounts of profitability.
The business model of TitTok is that it allows users to create, watch and share 15-second videos. These videos can be made catchy since TikTok allows the users to choose from various background filters and various sounds. The application has been downloaded and installed more than 315 million times across the globe!
Even though TikTok is a free app from the consumer's point of view, it still has various revenue streams which it can draw upon. TikTok has developed various forms of advertisements that it uses to make money on its application. Some of the most prominent revenue streams have been listed in the article below:
TikTok has been tight-lipped about the profit that it generates. The company does not share too much information. Also, since it is based in China, there is even more opacity as information shared for regulatory purposes is also not known. However, some estimates show that TikTok derives most of its revenue from China.
Estimates suggest that the company generates 80% of its revenue from China. However, the company is now trying to diversify into the global marketplace. The company faces a significant challenge as it has been banned in several countries because of the fear that it may be sharing user-generated data with the Chinese government.
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