AppLovin to Launch Social Platform After TikTok Bid Fails

The mobile advertising company AppLovin Corp. is getting ready to launch a social networking platform following its unsuccessful and failed attempt to purchase TikTok’s assets outside of China last year.

The company’s strategic shift is from facilitating advertisements in third-party apps to having its own platform for consumer engagement. This would lessen dependency on outside distribution by giving direct control over first-party user data and ad inventory.

A recent Chinese-language podcast featuring a top AppLovin executive, the Chief Product and Engineering Officer Giovanni Ge, laid out the ambitions, as did a job posting looking for someone to “architect the digital backbone of our next-generation social platform.”

In The Valley 101 podcast, Chief Product and Engineering Officer Giovanni Ge explained that the strategies and move were the antithesis of Meta Platforms Inc.’s strategy, which involved first developing a following on Facebook and Instagram before turning it into revenue through advertising. Although AppLovin already has an ad placement system, it mostly places such advertising in apps owned by other businesses after selling a collection of its own games last year.

If the move is successful, it may put Palo Alto-based AppLovin in direct rivalry with social media giants like Meta, TikTok, and Snap while also giving it access to more user data and power over the mobile advertising market.

Due to its advertising technology, which helps mobile apps and games attract new users and monetise their platforms, AppLovin’s worth has skyrocketed in recent years. The market capitalisation of AppLovin hit a record high of $248 billion in December.

Short seller reports and investor doubts about AppLovin’s ability to successfully enter the e-commerce advertising market have shaken the stock. The difficulties coincide with more general worries about how AI might upend the advertising sector. The company’s market worth has dropped by over 40% this year, to about $137 billion.

After the US threatened to ban TikTok unless its owner, ByteDance Ltd, sold it to a US-based company, AppLovin indicated interest in purchasing the company outside of China. Prior to being purchased by a group comprising Oracle Corp., Silver Lake, and Andreessen Horowitz, this prompted bids from a number of businesses.

The objective of the job posting for a “Backend Engineer” headquartered in Singapore is to create a system that facilitates media distribution, real-time social interactions, and content discovery.

Another important aspect of this initiative’s financial impact is that, following the news, AppLovin’s stock (APP) increased by roughly 2% as investors weighed the risks of entering the highly competitive social media business against the potential for new revenue streams.

A request for comment was not immediately answered by AppLovin.