Tencent says WeChat will struggle to gain U.S. users

Yahoo Finance's Julie Hyman, Adam Shapiro, Dan Howley and Rick Newman discuss what the future holds for WeChat in the U.S. as the Trump Administration and courts spar over its ban.

Transcripción del video

JULIE HYMAN: Let's talk WeChat chat for a moment as well because a US judge has halted the Trump administration's ban on WeChat. It was supposed to go into effect yesterday. Dan Howley, what happens now?

DAN HOWLEY: Yeah, basically now, we have to just see where kind of the court pushes this or leads this. Basically, WeChat, for people who don't know, is a major app in China. This isn't just a communications app. It's where people buy things. It's where they send money back and forth. They play games.

It's owned by Tencent, one of the largest players as far as software and gaming goes in the world. They have investments in a slew of US companies. You can look at something like Epic Games, where they have made a major investment as of late. And you know, it's not as though the app is something that's unknown outside of the US. And in the US, it's really mostly used by the Chinese diaspora just to communicate with their family back home.

So this is-- again, the national security concerns are based on the amount of data that China would be able to harvest from users of WeChat. But if it's not a huge amount of Americans using the app, then it kind of raises questions of what really is that threat? And you know, again, I got to go back to, well, OK, this is an app that's being used by people in China and can be accessed-- the data can be accessed by the Chinese government. But then you know, our data is harvested by the likes of Facebook, Google, Twitter, any numerous company here in the US. So really, you know, what does it come down to? Does it come down to the fear of China or the fear of our data?

RICK NEWMAN: Howley, Dan, is-- TikTok and WeChat, are they in the-- basically in the same boat here? Is Trump administration going after both of those in some concerted and very similar way, or are these essentially different cases?

DAN HOWLEY: It's along the same lines. But I think for WeChat, it's more of a means to say, look, we can hit this company that is so important to people who communicate back with China-- and businesses, by the way, that do work in China, such as Walmart and Disney, which take payments through WeChat. If we can hit this, we can hurt you, TikTok. So you know, just-- you need to be on your P's and Q's and work with us here.

You know, I think as far as what could have happened here if the Trump administration had said to WeChat, we're not going to let you work with any US company, it would've been a major problem for the likes of Google and Apple because if they weren't able to host those-- that app in their app stores in China, then people wouldn't have been able to really purchase iPhones or certain Android devices, just out of the sheer fact that they wouldn't really use that app on those devices. And then with the ubiquity of WeChat there, it really kind of makes it just impossible for people to continue to do business. So WeChat is incredibly important for China. I think for the people in the US, it really is kind of a test case for TikTok.