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Apr. 15 (NBD) -- India's Supreme Court has set for a hearing next Monday, in which a ban on Chinese short video platform TikTok could be imposed.

The Supreme Court's move came on the heels of its refusal to stay the order by the Madurai bench of the Madras High Court over TikTok ban on Monday.

The bench issued an interim order on April 3 asking the federal government to prohibit the download of the app, providing no opportunity to TikTok to defend itself.

TikTok hits regulatory walls overseas

Early this month, a court in the southern state of Tamil Nadu also directed the local government to ban TikTok, holding that the app encouraged pornography and made child users exposed to sexual predators, Reuters reported.

TikTok responded in a request for quashing the detectives handed to the Supreme Court that the ban will curtail the speech rights of Indian citizens.

It is noted that this is not the first time that the app triggered discontents over inappropriate contents in overseas markets.

A BBC investigation found hundreds of sexual explicit comments were posted on videos uploaded by minors on TikTok. The news agency revealed on April 5 that the video-sharing site has suspended majority of the accounts sending dangerous messages within 24 hours of being reported but some comments still remained.

In February this year, the Federal Trade Commission of the United States filed a court complaint against TikTok for illegally collecting names, emails and other information of children under the age of 13.

As a result, the Chinese app was fined 5.7 million U.S. dollars and started to require some part of American users to verify age.

Allegations against TikTok's improper contents were also made in countries including Indonesia, Japan, South Korea and Spain.

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Aggressive global expansion results in high marketing expense 

Launched by Chinese tech firm ByteDance in 2016 and introduced overseas one year later, TikTok created an online platform for users to produce and share short videos.

After trending in the Chinese market, the app made ambitious foray into overseas markets.

The Indian market, deemed as the major contributor for TikTok's outstanding accomplishment, is estimated to post 88.6 million new installs in the first quarter of 2019, 8.2 times the number for the same period of the previous year, according to research firm Sensor Tower.

Behind the good-looking growth numbers lie large promotion expenses for the company.

The app poured tens of millions of U.S. dollars to advertise on TV channels and websites in India. TikTok soon obtained more than 23 million users with 30-day retention rate of over 30 percent, which means the customer acquisition cost stands at around 20 cents per user. But TikTok earned a limited advertisement revenue in this market.

With markets where the cost for acquiring customers is high, the situation goes worse for TikTok.

The platform registered a whopping amount of expense on social giants such as Facebook and YouTube in the United States, including up to 300 million U.S. dollars on Google. However, the 30-day retention rate is as low as 10 percent, a person familiar with the matter said.

The high costs of overseas deployment of TikTok put heavy financial pressure on its parent, ByteDance. Such cash-burning way of global expansion contributed to ByteDance' losses of 1.2 billion U.S. dollars in 2018, digital media company The Information reported citing informed source.

On the way of TikTok's rapid global expansion, how to establish a complete content review mechanism and to cover advertising expenses with a profiting business model remains challenge for the app. 

Email: gaohan@nbd.com.cn