TikTok Allows Gambling Ads in Australia Despite Ban

Posted on: November 7, 2022, 11:15h. 

Last updated on: November 9, 2022, 02:27h.

Erik Gibbs Read More
Expertise: Asia Pacific Gaming, Gaming Business, Global Gaming.

As some US lawmakers call for a complete ban on TikTok, the video-sharing platform with Chinese origins is breaking its own rules in Australia. The company’s terms and conditions expressly forbid gambling-related advertising. But this hasn’t stopped it from allowing Sportsbet to start advertising through a pilot program.

TikTok Gambling Ads
One of seven gambling ads Australian sportsbook Sportsbet is running on TikTok. The idea of gambling ads on the social media platform is creating controversy in the country. (Image: TikTok/Sportsbet ad)

TikTok confirmed the trial with ABC News but said it is just a “limited trial” that the company is closely monitoring. The pilot is already causing friction in Australia, which is currently looking at ways to reduce all forms of gambling-related advertising.

Over 27% of the users on TikTok are under 17 years of age, according to data provided by internet commerce site Oberlo, and 25% are 21 years old or younger. In light of the current anti-gambling environment, it isn’t likely that Sportsbet’s pilot will find permanent legs.

TikTok is confident it can prevent anyone younger than 21 from seeing the gambling spots. However, when signing up for a new account, there’s no forced requirement to use an actual date of birth.

Attracting Younger Bettors

Sportsbet allegedly contacted TikTok, which now wants to get into the streaming music segment with TikTok Music, to request the pilot program. It isn’t clear how much the sports betting company is paying, though it’s unlikely TikTok is allowing the betting-related ads for free.

The ads don’t overtly promote betting. Instead, they hide it inside the content, designed to appear as a normal video. The only indication that it’s a promotion is the Sportsbet name and the inclusion of the “Gamble Responsibly” tagline the government requires.

The ads cannot be scheduled to run at specific times of the day, so that Sportsbet could run into trouble with regulators. Another potential problem is that Australia recently approved the introduction of new taglines, which operators are now beginning to introduce, and the appearance of a message such as “What are you prepared to lose today? Set a deposit limit” will likely take up the entire TikTok screen.

Calls for a TikTok Ban

Some Australian lawmakers want the pilot project called off and buried in the sand. They prefer a complete ban on gambling advertising. The US wants to go further and bury TikTok in the sand.

Every few years, lawmakers in the US call for a ban on the streaming platform. It hasn’t happened, even serving as the model for YouTube Shorts and others. This new push to quash TikTok coincided with the US midterm elections.

At the heart of the issue is the revelation that the company behind TikTok is ByteDance, a Chinese firm. Although it has significant backing from companies like Sequoia Capital and BlackRock, all the data it compiles previously went to its Chinese headquarters. TikTok moved its servers to the US following backlash that user data might be making its way to the Chinese Communist Party (CCP). It also stated that none of the information is accessible outside the network.

Some lawmakers have expressed their concerns that this isn’t completely true. Senators Josh Hawley and Rick Scott assert that there are members of the CCP on ByteDance’s board. To them, this implies an inherent security risk.

TikTok maintains a secondary line of servers in Singapore, providing backup to the primary network. All of the US user data is allegedly copied onto those servers.

Certain representatives of the Federal Trade Commission and the Justice Department have also called for a ban on TikTok. It’s not a scenario that is likely to come to pass. But changes are almost certainly coming.