Chinese Government Takes Stake in TikTok, Raising Questions About National Security and Data Privacy

TikTok

There has been much speculation about the security of TikTok, a video sharing social media app that exploded in popularity in 2020. In August of last year, former U.S. President Donald Trump signed an executive order banning TikTok in the United States, unless ByteDance, the Chinese parent company that owns TikTok, divested ownership or an American company purchased the app.

At the time, the Trump administration expressed national security concerns because TikTok was owned by a Chinese company, although TikTok has repeatedly denied claims that they have shared user data with Beijing.

TikTok Trends in Politics

Though President Joe Biden signed an executive order revoking Trump’s order to ban the app less than a year later, these security concerns haven’t gone away. In fact, in August The Information reported that the Chinese government quietly took a 1 percent stake and a board seat in a key subsidiary of ByteDance in April of this year. With only three board seats available, this move suggests that the government has gained a greater level of influence at this subsidiary than just a small equity stake would suggest.

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Republican Senator Marco Rubio recently released a statement urging Biden to block TikTok in the U.S. “Beijing’s aggressiveness makes clear that the regime sees TikTok as an extension of the party-state, and the U.S. needs to treat it that way,” Rubio said in a statement. “We must also establish a framework of standards that must be met before a high-risk, foreign-based app is allowed to operate on American telecommunication networks and devices.”

Too Much Data, Not Enough Control

It is not unusual for the Chinese government to hold shares in tech firms, but this news accompanies a recent increase in antitrust probes and growing concerns that private technology companies are gaining too much data without being checked. In response to these issues, the Chinese government cracked down by taking greater stakes in these private companies, which could make it difficult for Chinese firms to do business overseas.

Beijing has also launched investigations into some of the biggest internet companies in China, tanking share prices across industries, with some stocks falling more than 90 percent. They also introduced new draft rules to strengthen data security and prohibit companies from engaging in antitrust violations after rapid, unprecedented growth in the tech industry. Some of the largest tech companies in China include Alibaba and Tencent, which provide a wide range of services from e-commerce and payments to gaming and social media for hundreds of millions of Chinese people.

In the United States, officials are concerned that TikTok’s indirect connection to the Chinese government could put user data at risk. However, TikTok released a statement saying that the China-based subsidiary of ByteDance in which the Chinese government owns a stake does not have any ownership of TikTok, only Chinese apps. In fact, users in China cannot even access the app; instead, they use a similar app called Douyin.

You Are the Product

I’ve written about the growing issue of privacy in the age of social media before. Like many apps and social media platforms before it, TikTok collects user data because ultimately it’s the users that are the product, not the free app. To monetize their services, social media sites and apps collect user data like browsing history, shopping habits, locations, and other information, and use this data to enable companies to target users more accurately through paid advertising.

The idea of a foreign government leveraging private user data to spy on Americans might sound exciting, but the reality of the situation is that exchanging our data for a free app has become the norm. That the Chinese government owns a small percentage of a Chinese subsidiary of the company that owns TikTok doesn’t change things. With over 1 billion users in more than 150 countries, TikTok already has access to huge amounts of user data that people willingly give to them, just like Facebook, Google, and other tech giants do.

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