By Pedro David Espinoza, CEO — Pan Peru USA
Since its inception over a decade ago, social media has created both positive and negative externalities in consumption and production. More recently, however, TikTok — the fifth largest social media app in the world by active monthly users — has been in the national headlines when it comes to Trump's ban.
As a digital native myself, I have experienced both the benefits and drawbacks of social media. I recall when I was working on my first business book, “Differences That Make A Difference,” and met Judith Estrin — an internet pioneer, Cisco's first CTO, and a board member at FedEx and The Walt Disney Company. When we met, I was expecting her to bring an iPad, iPhone, smartwatch, or some other digital tool, but she brought a pen and paper with her instead!
Estrin mentioned that she pretty much regretted helping create the internet, to a certain extent, primarily due to all the anxiety, depression, and mental health issues the internet has created, especially in the female youth of our world. It's wild to quantify and even think of the millions of teens struggling with social media addiction and anxiety.
We are addicted to our smartphones and screens because of the internet. Unfortunately, the recent rise in AI tools is not helping with this. Many high school students today utilize AI, LLMs, agents, and other AI systems, such as ChatGPT, for their essays, homework, and assignments.
Please don't take me the wrong way; I'm all about technology. (I'm a tech entrepreneur and Silicon Valley investor, after all.) Nevertheless, it’s imperative that we use AI with wisdom, moderation, and prudence. AI should help us think, but should not be our crutches. AI should help us become better, be more creative, and think outside the box, but we shouldn't rely 100% on AI for every single task.
When it comes to TikTok, I should be transparent in saying that I don't have a TikTok profile. Regardless, the economic impact of banning TikTok could prove significant, as it is one of the fastest-growing and most widely used social media platforms available today.
For one, advertisers use TikTok all the time, especially when targeting Gen Z and Millennials. I invest in, own, and operate businesses in countries like Thailand, Bangladesh, Peru, Poland, Singapore, and others. I've personally seen how useful TikTok is when it comes to B2C and B2B marketing.
To give you one example, in Peru, many social media users spend their entire day on TikTok. Forget Facebook; if you want to capture attention with your advertisements, you need a presence on TikTok.
While some argue that completely banning TikTok in the US could be a good move when it comes to caring for our youth's mental health, peace, and emotional well-being, it could also harm our economy by scaring away advertisers and Chinese investments. As a result, foreign direct investment might decrease.
Of course, from a national defense and geopolitical perspective, it is wise for the US not to rely too heavily on China. We can all attest to China's growth, power, and prowess in both economic and human development. China's GDP has been growing remarkably over the last few decades. Shanghai 40 years ago was a very different (and, arguably, far more impressive) city from what it is today.
I think President Trump's idea of having a US company own TikTok's US operations is wise. I agree that we need better accountability, checks and balances, and audits and controls of Chinese companies on US soil. We have all witnessed the rise of hacks, cybersecurity scams, and fraud associated with digital attacks, social media impersonations, and phishing emails.
President Trump wants to protect the American people, the American youth, and wants to make sure that China doesn't control/sway TikTok users in the US. I believe we need greater accountability and transparency from social media companies, particularly those that are not US-owned.
When it comes to privacy, this is a nuanced issue; there is essentially no privacy in today’s age. We live in the age of AI. Everything is digital. User-generated content is not owned by users but by the big tech companies. It's the world we live in; it is what it is. This won't change anytime soon. I believe we need to be adaptable, flexible, resilient, and open to change.
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