Social Media - The Accelerator and Feeder of The Modern Economy

Social media is a set of applications where people can communicate with each other, sharing anything they want to public and interact with each other and modern society. Social media has the same subject of internet which is connect people all around the world easier. But social media is also impacting the economy a good way. It not just creating more job opportunities and higher the share of its own industrial, but also helps other economic systems. News, education, tourism, government, shopping, entertainment and so on. This social media argumentative essay looks at exactly how mass media is changing economies around the world.

For example, the U.S. TRADE AND development Agency (USTDA) really has a good use of the convenience that social media brought. USTDA helps a lot of U.S companies provide new job opportunities by exporting goods and services for under-developing projects in new rising markets. Applications such as twitter and Facebook helps USTDA grow more followers, shows more content for customers and their partners have a chance to promote their content as well. One particular case, social media increased the efficient between US-Africa business forum.

Before the pandemic, quite a few people notice the impact of social media has made. According to research, people average spending 9 hours per day on social media platform like Google, Facebook, YouTube, Amazon, TikTok. And there are over 3.5 billion people are using social media platform actively access different pages online to buy or check recommendations for them of the best products. And also, compared to traditional market, social media is a cheap method of advertising but also more flexible and more straightforward.

It is obviously that current app economy is boosting the media industries. Apple reported that in 2014, the App Store generated “$10 billion in revenue for developers”. According to the research conducted by the International Data Corporation, in the year 2015, “direct (non-advertising) revenue from mobile app installations was around $34.2 billion. In 2020, direct revenue is forecast to be $57 billion, a figure that equates to a compound annual growth rate of 10.6%”. Other than installations, the app itself can generate a huge amount of profits. In 2019, YouTube has 15.15 billion USD in revenue while Netflix has 20.16 billion and TikTok has 17 billion.

TikTok - a Game Changer in the World of Social Media

During the global pandemic, covid-19, the world economy is under a big challenge. Many shops are forced to close, people are forced to stay home, society is stop moving forward. But, one thing that is not affected is social media. However, it actually accelerates the rise of social media apps such as TikTok. Since people are doing nothing but staying at their home browsing their phones. TikTok has the highest follower engagement rates across 100,000 user profiles sampled in an online research project conducted by Influencer Marketing Hub.

But other than video sharing platform, there is a new rising star. The “live streaming system”. People sharing anything they want through the camera to millions of viewers at the same time. With this mode, live streaming is the future. “According to a Bloomberg article, which cites sources “familiar with the matter”, ByteDance’s (TikTok’s parent company) 2019 revenues were more than double its 2018 takings.If correct, it means the new video streaming service on the block has overtaken incumbent YouTube, which reportedly raked in US$15.1 billion ($22.2 billion) in ad sales last year. It hasn’t quite caught up with Instagram, though, which bought in US$20 billion ($29.4 billion) in revenue for parent company Facebook in 2019.” TikTok in China, has 1.5 billion active users each month before the covid-19. Imagining this year’s number! Also, another live streaming app--Twitch has finally overtaken YouTube who brought $1.54 billion in live steaming.

But, not just the platform, the company. Normal people like us can gain a huge profit from this industry. According to Google, Richard Tyler Blevins, who is preferring to be called as “ninja”, a twitch streamer made $17 million US dollar last year by simply sitting on his chair playing games and broadcasting to viewers all around the world. While covid-19 suspended most people’s job, however, apparently not his. According to Sportskeeda, an esports website, ninja is about to earn $20 million this year. While people are dying to find a job, ninja, as a streamer is sitting in his super cool gaming room making his way to a millionaire. Not just ninja himself. The entire online streaming and short video industry is keep rising while other industries are still fighting for a way out under the influence of covid-19.

TikTok's earnings have risen proportionately with its increase in popularity. While the most recent figures available come from before TikTok introduced its advertising market, they still show a sizeable increase in monthly earnings. By October 2018, TikTok was earning $3.5 million per month from in-app purchases, such as emojis and digital gifts. With the introduction of the formal advertising market, it is likely that TikTok's income is now considerably higher than this.

Tiktok is so easy to make money, thus now streamer is an official occupation now. Everyone wants a cut of this “golden cake”. Addison Rae Easterling, a normal college student who was posting some dancing videos, now earn $5 million though the app. This is not just a special case; it’s getting more and more popular that people gain followers on TikTok and gain profits from sponsors. Charli D’Amelio with $4 million, Dixie D’Amelio with $2.9 million. Loren Gray with $2.6 million.

It’s just too obvious that social media is not just for entertainment. It has a huge impact on economy that might even trigger some politics. Recent example is U.S president Donald Trump just announce the ban for TikTok in North America. And the impact of this ban is huge. Since TikTok is a global popular application, it has a huge share in global market. Although launching in 2016, the application didn't really make it way out to the top until 2019 – we estimated the revenue of the app can produce in anywhere worldwide to be around $200 to $300 million in last year. And it is going to break $500 million gate in the U.S. market in 2020.

Retailers can scale their advertising on TikTok, from brand takeovers for $50,000-100,000 to native ad campaigns for a minimum of $500. Not included in TikTok's revenue is the amount brands put toward influencer marketing. Many creatives are compensated directly by brands and pay is scaled based on the number of followers and average engagement that the user has.

It is clear to conduct that banning TikTok will have a huge deficit on U.S economy. U.S government should think carefully while U.S economy contracted by over 30% this year.

Without a Systematic Restriction, There are a Lot of Concerns 

With all those benefits, people are urgently walking into the world of social media for whatever purpose is. First, the laws against those online industry is not well-established yet, people are making more money than they should be. For instance, they don’t tax when their mainly money is given as “gifts”. However, this is a occupation, all earnings should considered as a income, which should put them as tax payer. Therefore, those incomes are considered as “money from moonlighting”. Since it’s neither legal nor illegal income.

Other risks are people’s awareness of the security problem behind the short-videos and live streaming. There is an Indonesia teenager has died while making a TikTok video. The high school student from Bekasi, was electrocuted when she reached for her phone that fell between power cables. According to Daily Mail (UK), a singer is hit by a train and killed while live-streaming himself listening to loud music in his car on a Romanian railway crossing. Anything can be a double-edged sword, while we gain benefits from TikTok, we should also make sure there is established laws to constrain it and help it grow in a safe way to help wake the down-warding global economy.

Final Thought

In a word, the new social media industry is a rising star of global economy market. It pushes global economy forward and connects people around the world. It’s not just changing the way we communicate, but also changing the way we do business.