BEIJING, April 26 (TMTPOST)— Tesla CEO Elon Musk’s takeover of Twitter may be a good chance for Chinese internet giant ByteDance as its unit TikTok, the most popular short-video platform emerging these years in the Western world, seems to get a new drive for advertising.
Source: Visual China
Wall Street analysts deemed TikTok and other social media or video platforms as beneficiaries of Musk’s deal. Since Musk prioritizes free speech for Twitter, advertisers may shift budgets to other channels given brand safety concerns, which could help TikTok, YouTube, Snap and Meta, JMP analysts expected. The firm noted 85% of Twitter’s revenue came from brand advertising. Evercore analysts said advertisers has “distinct possibility” to move their events to platforms like TikTok, Meta, Snap. Stifel analysts forecast Twitter could lose about $7 billion of ad revenues in 2023 as advertisers are shifting their spending to other platforms like TikTok, Snap and Pinterest.
TikTok is expected to triple the annual ad revenue this year to $11.64 billion from $3.88 billion in 2021, overtaking the combined sales of two major social media rivals Twitter and Snap at $5.58 billion and $4.86 billion, according to Insider Intelligence earlier this month. The research firm estimated TikTok would generate almost $6 billion in U.S. ad market this year, or more than half of its total ad revenue, despite the regulatory concern of user data security. TikTok, with over 1 billion monthly active users, is expected to earn $23.58 billion by 2024, inching closer to YouTube’s $23.65 billion and making two video platforms each gain around 3% of global digital ad market, the firm predicted.
After posting about RMB25.46 billion (nearly US$4 billion) of the ad revenue in the year 2021, TikTok has set a target this year to make ad sales at least triple, namely, to generate no less than RMB76.37 billion (US$12 billion), the similar size of China’s largest search engine Baidu’s annual ad revenue in 2020, LatePost reported in January. The Tencent’s online media outlet noted TikTok has stepped up commercialization and scaled up recruitments in for the businesses of ad, overseas e-commerce and live streaming in the past year since it now has almost 20,000 employees, compared with less than 4,000 about two years ago.
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