EU Investigators Launch Probe into TikTok’s Latest Growth Initiative

Looks like another tough week ahead for TikTok.

With the U.S. looking to push ahead a Senate vote that may decide the fate of the app for its 170 million American users, E.U. officials are also questioning another TikTok initiative, which is seemingly designed to increase usage in that region.

A couple of weeks back, The Information’s Kaya Yurieff reported that TikTok had launched a new offering in Spain, France, and several other countries, which effectively pays users for using the app.

As explained by Yurieff:

“[TikTok] is introducing a new app that will encourage users to watch videos, invite friends to sign up and perform other actions by awarding them points they can redeem as gift cards or digital tips to give creators. The app, called “Coin App” within the company and “TikTok Lite” to the public, is designed to help TikTok boost growth among people aged 18 and older.”

At the time, when I read this update, I assumed there may be something more to it, as TikTok actually launched its separate “TikTok Lite” app back in 2018. So it wouldn’t be a new app, as such, but a new program, and it seemed like there would be more information to come as to how the initiative would function.

But based on screenshots, this is exactly how TikTok Lite’s rewards program works.

The prompts here inform users that they can earn points by discovering and liking videos in the app. There’s also a meter that fills up to let you know how you’re progressing towards point goals, gamifying usage of the app.

And evidently, E.U. investigators have seen enough to raise their own concerns, with the E.U. today announcing a formal probe into the TikTok Lite program, which it believes may be in violation of its  Digital Services Act (D.S.A.).

As per E.U. Commission:

“The Commission has opened a formal proceeding to assess whether [TikTok] may have breached the DSA when launching TikTok Lite in France and Spain. Under the DSA, designated Very Large Online Platforms are obliged to submit a risk assessment report, including measures to mitigate any potential systemic risks, prior to launching any new functionalities that are likely to have a critical impact on their systemic risks. The Commission is concerned that the “Task and Reward Program” of TikTok Lite, which allows users to earn points while performing certain “tasks” on TikTok – such as watching videos, liking content, following creators, inviting friends to join TikTok, etc. – has been launched without prior diligent assessment of the risks it entails, in particular those related to the addictive effect of the platforms, and without taking effective risk mitigating measures.”

E.U. investigators are especially concerned about the potential impacts of the program on children, as it would incentivize more usage, with kids effectively being paid to keep scrolling in the app.

Which seems pretty bad, and not a great look for TikTok overall.

The E.U. Commission says that it may seek to suspend the program in the immediate term, while violations of the D.S.A. can also cost companies up to 6% of their global revenue.

TikTok will now have until April 24th to outline its response to the claims.

Really, if this is the framework that TikTok is going with to reignite interest in the app, then it’s a pretty desperate measure, which is likely to trigger sanctions against the app.

According to Yurieff, TikTok has seen a slowdown in usage of late. The platform currently has around 136 million users in Europe, a significant chunk of its overall audience, though its momentum has eased as other platforms have offered comparative functions like Instagram Reels and YouTube Shorts.

Which is why it’s looking to new initiatives to boost interest once again, and the proposed outline of this program is questionable, on various fronts.

Basically, if this is what TikTok’s offering, it’s a problem, that will see it punished as a result. But maybe, TikTok has some alternative explanation, which it will present to European authorities.   

Either way, it’s another headache for the app, especially as it’s trying to argue that it’s not looking to influence user behavior.