For nearly five hours, Congress members of the House Committee on Energy & Commerce grilled TikTok CEO Shou Zi Chew over concerns about the platform's risks to minor safety, data privacy, and national security for American users.
“The American people need the truth about the threat TikTok poses to our national and personal security,” committee chair Cathy McMorris Rodgers (R-Wa.) said in her opening statement, concluding that “TikTok is a weapon.”
Rodgers suggested that even for Americans who have never used the app, “TikTok surveils us all, and the Chinese Communist Party (CCP) is able to use this as a tool to manipulate America as a whole.”
New reports say the US Justice Department is investigating TikTok-owner ByteDance over recent
revelations
that employees tracked journalists in an attempt to find out who leaked company data to the press.
The Justice Department and US Attorney in the Eastern District of Virginia "subpoenaed information from ByteDance regarding efforts by its employees to access US journalists' location information or other private user data using the TikTok app,"
Forbes reported yesterday
. "According to two sources, the FBI has been conducting interviews related to the surveillance."
The investigation was also confirmed today in
New York Times
and
Wall Street Journal
articles citing anonymous sources. The investigation reportedly began in December. ByteDance is based in China, and TikTok is
facing the possibility
of being banned in the US if it doesn't sever ties with its China-based owners.
After US President Joe Biden and the Committee on Foreign Investment in the United States (CFIUS) spent years trying to work out a deal with TikTok that could address national security concerns, Biden seems to have given up. Yesterday, TikTok confirmed that the Biden administration issued an ultimatum to the app’s China-based owners to either divest their stakes or risk a TikTok ban in the US,
Reuters reported
.
Biden’s demand comes just one week before TikTok CEO Shou Zi Chew is scheduled to testify before the House Energy and Commerce Committee.
The Wall Street Journal confirmed
that Chew is already in the US and is working with “experienced Washington advisers” to help him defend TikTok against its harshest critics in Congress next Thursday.
Chew told The Journal that forcing a sale does not address national security concerns any better than the deal that TikTok had already worked out with the CFIUS. Under the deal that Biden seems to be shrugging off now, TikTok has already invested billions in moving its US users’ data to US servers and hiring independent monitors to ensure that Americans’ TikTok feeds can’t be manipulated and that their data can’t be accessed by China authorities.
The Department of Commerce has put a stay on enforcing an executive order that would have forced popular short-form video app TikTok to suspend all US operations as of midnight tonight, a tacit admission that the proposed ban isn't actually all that important to the administration any longer.
Commerce said the orders against TikTok are on hold "pending further legal developments" in multiple lawsuits, the Wall Street Journal reports.
President Donald Trump earlier this year signed two executive orders relating to TikTok. The first , on August 7, declared the app to be a national emergency. A second ( PDF ), issued one week later, gave ByteDance, TikTok's parent company, 90 days to divest the app to a US owner.
President Donald Trump's attempt to ban TikTok from operating inside the United States probably exceeds the authority the president has to do such things, a federal judge has ruled.
TikTok narrowly avoided being removed from app stores last night when Judge Carl Nichols of the US District Court for DC issued an injunction late yesterday requiring the government to pause on its ban. TikTok got its reprieve, but the terms of the order ( PDF ) were sealed until midday today.
To meet the standard for an injunction, Nichols explained, TikTok basically needed to prove four things to his satisfaction. The first factor, however, is the most important: TikTok needed to prove its case is "likely to succeed on the merits." In plain English, that means: is it going to win its lawsuit against the administration? And the answer, Nichols determined, is probably yes, because the actions the administration took "likely exceed the lawful bounds" of the law under which those actions were taken.
TikTok will be gone from app stores tomorrow morning unless a federal judge acts to block the Trump administration's ban on the app before midnight tonight.
Judge Carl Nichols of the US District Court for DC said today that he will determine whether to grant or reject TikTok's request for an injunction on the ban before the deadline hits at the stroke of 12.
In a hearing on Thursday, Nichols gave the administration until Friday afternoon either to delay or defend the ban. The administration chose to file a response defending the ban but did so under seal, so the filings are not available to the public.
TikTok and its parent company, ByteDance, filed suit today in federal court arguing that President Donald Trump's efforts to ban the app or force a sale to a US firm are not grounded in facts but instead are part of an "anti-China political campaign."
An executive order curtailing TikTok's US operations "is not rooted in bona fide national security concerns," TikTok argues in its complaint ( PDF ). "Independent national security and information security experts have criticized the political nature of this executive order, and expressed doubt as to whether its stated national security objective is genuine," the company adds.
TikTok's complaint seeks to prevent the president and the Department of Commerce from "impermissively banning" the app, alleging that the authority under which the order was enacted (the International Emergency Economic Powers Act, or IEEPA) was a "gross misappropriation" and "a pretext for furthering the President's broader campaign of anti-China rhetoric in the run-up to the US election."
Hello and welcome back to TechCrunch’s China Roundup, a digest of recent events shaping the Chinese tech landscape and what they mean to people in the rest of the world. This week, TikTok, currently the world’s hottest social media app, welcomed the new decade by publishing its first transparency report as it encounters rising scrutiny from regulators around the world.
TikTok tries to demystify
The report, which arrived weeks after it tapped a group of corporate lawyers to review its content moderation policy, is widely seen as the short video app’s effort to placate the U.S. government. The Committee on Foreign Investment in the United States, or CFIUS, is currently probing the app for possible national security risks.
TikTok is owned by Beijing-based tech upstart ByteDance and has been rapidly gaining popularity away from its home turf, especially in the U.S. and India. As of November, it had accumulated a total of 1.5 billion downloads on iOS and Android devices, according to data analytics firm Sensor Tower , although how many materialized into active users is unknown.
The transparency report reveals the number of requests TikTok received from local regulators during the first half of 2019. Such orders include government requests to access user information and remove content from the platform. India topped the list with 107 total requests filed, followed by the U.S. with 79 requests and Japan at 35.
The numbers immediately sparked debates over the noticeable absence of China among the list of countries that had submitted requests. This could be because TikTok operates as a separate app called Douyin in China, where it claimed to have more than 320 million daily active users (in Chinese) as of last July.
Whether skeptics are sold on these promises remains to be seen. Meanwhile, one should not overlook the pervasive practice of self-censorship among China’s big tech.
“Chinese internet companies know so well where the government’s red line is that their self-regulation might even be stricter than what the government actually imposes, so it’s not impossible that [the TikTok report] showed zero requests from China,” a person who works at a Chinese video streaming platform suggested to me.
It’s worth revisiting why TikTok has caused a big stir on various fronts. Besides its nationality as a Chinese-owned app and breathtaking rise, the app presents a whole new way of creating and consuming information that better suits smartphone natives. It’s been regarded as a threat to Facebook and compared to Youtube, which is also built upon user-generated content. However, TikTok’s consumers are much more likely to be creators as well, thanks to lower barriers to producing and sharing videos on the platform, venture capitalist David Rosenthal of Wave Capital observed . That’s a big engagement driver for the app.
Another strength of TikTok, seemingly trivial at first sight, is the way it displays content. Videos are shown vertically, doing away the need to flip a phone. In a company blog post (in Chinese) on Douyin’s development, ByteDance recounted that most short-video apps budding in 2016 were built for horizontal videos and required users to pick from a list of clips in the fashion of traditional video streaming sites. Douyin, instead, surfaces only one video at a time, full-screen, auto-played and recommended by its well-trained algorithms. What “baffled” many early employees and interviewees turned out to be a game-changing user experience in the mobile internet age.
Douyin’s ally and enemy
A recent change in Douyin’s domestic rival Kuaishou has brought attention to the intricate links between China’s tech giants. In late December, video app Kuaishou removed the option for users to link e-commerce listings from Taobao, an Alibaba marketplace. Both Douyin and Kuaishou have been exploring e-commerce as a revenue stream, and each has picked its retail partners. While Kuaishou told media that the suspension is due to a “system upgrade,” its other e-commerce partners curiously remain up and running.
Left: Douyin lets creators add a “shop” button to posts. Right: The clickable button is linked to a Taobao product page.
Some speculate that the Beijing-based company could be distancing itself from Alibaba and moving closer to Tencent, Alibaba’s nemesis and a majority shareholder in Kuaishou. Yunfeng Capital, a venture firm backed by Alibaba founder Jack Ma, has also funded Kuaishou but holds a less significant equity stake. That Douyin has long been working with Alibaba on e-commerce might have also been a source of discordance between Kuaishou and Alibaba.
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