TikTok has been in the hot seat since the Trump administration, and now the Biden administration is following suit. They are demanding that TikTok’s Chinese owners, ByteDance, sell their stake in the video-sharing app or face a possible ban in the U.S., reports the Wall Street Journal. The concern is China’s national security law which requires companies to give them access to consumer data if requested. Approximately 100 million Americans use TikTok. Though the U.S. could impose a nationwide ban of TikTok, the Chinese government would have to approve a sale of Chinese-owned shares of the company.
According to sources, the Committee on Foreign Investments (Cfius), a multi-agency federal task force with oversight over national security risks in cross-border investments, said a sale is necessary to avoid the security risk posed by TikTok. Cfius is run by the U.S. Treasury Department. TikTok CEO Shou Zi Chow said that divesting the Chinese-owned shares of TikTok won’t protect the U.S. any more than the plan TikTok already proposed. This includes hiring Oracle Corp. at a cost of about $1.5 billion to store the data of American TikTok users to keep it out of the hands of the Chinese government.
“If protecting national security is the objective, divestment doesn’t solve the problem: a change in ownership would not impose any new restrictions on data flows or access, ” said TikTok spokeswoman Brooke Oberwetter in a statement. “The best way to address concerns about national security is with the transparent, U.S.-based protection of U.S. user data and systems, with robust third-party monitoring, vetting, and verification, which we are already implementing.”
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Other TikTok bans
In late February, Canada announced that it would ban TikTok from all government mobile devices, reports NPR.
“I suspect that as government takes the significant step of telling all federal employees that they can no longer use TikTok on their work phones many Canadians from business to private individuals will reflect on the security of their own data and perhaps make choices,” Prime Minister Justin Trudeau said. “I’m always a fan of giving Canadians the information for them to make the right decisions for them.”
In March, the European Commission banned TikTok from official devices. The Commission’s staff was given until March 15 to remove the app from work devices as well as personal devices that use Commission apps and services, says CNN.
In December 2022, Congress passed a bipartisan spending bill that included banning TikTok from government devices. At that time, a TikTok spokesperson said that the ban was a political gesture that will not advance national security interests. TikTok had been banned in 16 states with a partial ban in two additional states. The State of Indiana went so far as to sue TikTok, alleging that the video-based social platform exposes minors to inappropriate content and makes user data accessible to the Chinese government.
In July 2022, the Federal Communications Commission asked Apple and Google to remove TikTok from their app stores.
“It is clear that TikTok poses an unacceptable national security risk due to its extensive data harvesting being combined with Beijing’s apparently unchecked access to that sensitive data,” said FCC commissioner Brendan Carr. “But it is also clear that TikTok’s pattern of conduct and misrepresentation regarding the unfettered access that persons in Beijing have to sensitive U.S. user data – just some of which is detailed below – puts it out of compliance with the policies that both of your companies require every app to adhere to as a condition of remaining available on your app stores. Therefore, I am requesting that you apply the plain test of your app store policies to TikTok and remove it from your app stores for failure to abide by those terms.”
Four TikTok employees fired for accessing journalist data
In early December, ByteDance fired four employees for accessing the personal data of two journalists on the TikTok platform, one from the Financial Times and one from BuzzFeed, reports CNN Business. The employees were investigating leaks to the media. Following an external investigation, ByteDance fired two U.S. employees and two in China.
“The individuals involved misused their authority to obtain access to TikTok user data,” Chow said in an email to employees. “This is unacceptable.”
Insider Take
The federal government has been trying to ban TikTok for more than two years. While TikTok has proposed solutions and started implementing them, the U.S. government is not convinced that the data of American users is safe. This latest demand that Chinese owners of TikTok sell their shares is not an official order, nor is a national ban imminent. It seems more likely to be a threat to break up the current stalemate between the U.S. and ByteDance. With more Western countries joining forces in banning TikTok, the issue is now a global one. From a subscription standpoint, the issue impacts creators, some of whom are abandoning ship to move to other platforms. While the existing bans are probably not significant enough to impact TikTok-generated revenue, creators need a plan B should the Biden administration make headway in banning TikTok.
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