Original link: https://www.latepost.com/news/dj_detail?id=1568
After three years, the U.S. Congress once again held a hearing on TikTok, and TikTok is also facing the possibility of spin-off or being banned again. A congressman told TikTok CEO Zhou Shouzi who was questioned at the hearing, “I have to thank you. You have done something unimaginable in the past three or four years. You have united the Republican Party and the Democratic Party.”
In the two hearings in 2019 and 2020, TikTok chose not to send people to attend. But this time TikTok CEO Zhou was funded to attend the questioning.
“This is not a good sign.” A person who once worked for an American think tank and lobbying company told “LatePost” before the hearing. According to past experience, similar hearings are more of a stage created by lawmakers for their own voices. “TikTok could have refused to attend the same as the previous two times, but the choice to show up this time shows that the internal judgment of the current situation is not optimistic, and it can only give it a go.”
The result is also the same. In the nearly 5 hours of hearing, Zhou Shouzi only got nearly 6 minutes of uninterrupted time to fully state TikTok’s position at the beginning. Most of the time, he will be interrupted after speaking for less than half a minute, and sometimes he can only speak for 4-5 seconds before being asked to answer the question directly with “yes or no”, and then the congressman will usually give his own conclusion.
Dell Cameron, a senior political and policy reporter for Wired magazine, wrote an article after the hearing and commented that this hearing reflected the problems of the US Congress. “Zhou Shouzi’s explanation of TikTok’s specific measures was frequently interrupted-these representatives should be very interested. They wasted the opportunity to have the CEO testify under oath, answer these questions clearly, and put them on the record, just to be on TV There is more drama on the screen. On the contrary, Zhou Shouzi is like the embodiment of patience.”
Similarly, in an interview with Pandaily, Jeffrey Towson, founder of TechMoat, an Asian digital strategy consulting agency, also believed that Zhou Shouzi was more restrained than Zuckerberg when he was questioned. He believes that TikTok needs to let the outside world see a trustworthy individual image, which is very suitable for Zhou Shouzi.
The problems facing TikTok will not change because of a hearing.
TikTok is more deeply embedded in American society than it was three years ago. Currently, at least half (150 million) of Americans use this product every month, which is three times the number in 2020. According to “LatePost”, TikTok has more than 80 million daily active users in the United States, about half of Facebook, the largest social platform in the United States.
The challenges facing TikTok have also gotten tougher. Biden, a lawyer, has more time than Trump. He promotes security reviews and legislation in Congress, approaching TikTok step by step in a more procedural justice way.
It is the environment more than ByteDance that ultimately determines the fate of TikTok. For four years, the differences between the two great powers have not been bridged. The bill against TikTok has bipartisan support in the US Congress.
Before this hearing, the Biden administration, like its predecessor, gave TikTok two options: spin off and sell the US business, or be banned.
If TikTok is divested or sold from ByteDance, it will also involve technology export issues. “Personalized push technology based on data analysis” has been included in the export restriction list in August 2020 and needs to be submitted for approval in advance.
If TikTok is banned in the United States, it will be the first time that the United States has legislated to ban an overseas Internet product. In the future, the development of TEMU, SHEIN and other Chinese Internet products in the United States will also be full of variables.
This time, “LatePost” still cooperates with “Pandaily” to directly cover the whole process of the Washington hearing. “Pandaily” (Pandaily.com) is an English-language media that reports on China’s technology and business. Its readers are overseas pan-tech business people who are interested in China, mainly in North America, Europe and Southeast Asia.
Hearing scene: yes or no?!
The hearing started at 10:00 on March 24th, Washington local time (22:00 on the 23rd, Beijing time), and lasted nearly 5 hours without counting three breaks. The hearing was widely followed. An American citizen present who has attended congressional hearings on the spot said that under normal circumstances, there will be many vacancies for such hearings, but even with online live broadcasts, there are still long queues at the door of the hearings.
At the beginning of the hearing, Cathy Rodgers, a Republican member of the U.S. House of Representatives and the chairman of the hearing, first expressed her core point of view: TikTok is a serious threat to the lives of the American people. It helps foreign governments collect sensitive data and control what everyone hears and sees , It is a channel for drug dealers to sell fentanyl, and there is also bad information that hurts young people. She said that TikTok’s so-called data protection measures “Project Texas” (Project Texas) is nothing more than a publicity act, and this product should be banned. “When you celebrate TikTok with 150 million US users, it shows the urgency of this matter.”
Zhou Shouzi was the only representative from the TikTok side to accept the question. In the opening self-introduction, he first emphasized his Singaporean identity, “I am a Singaporean, born and raised in Singapore, and later went to study in the UK and the US.” He also mentioned his wife, “I first met in the US She, she was born not far from here in Virginia.”
He revealed that TikTok currently has a strong influence in the United States-150 million users use TikTok, and 5 million companies do business on the platform. He also said that he needs to clarify the misunderstanding of this product: TikTok is a subsidiary of ByteDance , but not controlled by the Chinese government; TikTok is headquartered in Singapore and Los Angeles, USA; US user data is stored by a US company on US soil, supervised by US personnel, and Oracle and other US companies will review and verify the source of TikTok codes and algorithms.
In the next five hours, more than 50 members of Congress sent more than 200 questions to Zhou Shouzi. The core topics mainly revolved around:
- TikTok’s relationship with the Chinese government and parent company ByteDance
- Data protection, privacy security and US national security issues for US users
- Protection of Minors
- The problem of dissemination of false and disinformation
Most of the time, Zhou Shouzi tried to explain the specific situation, or what the situation would be after the “Texas Plan” was completed, and guided the answer to the direction he wanted to express. This is a common practice for large companies to respond externally.
But most of his answers lasted no more than a few seconds before being interrupted by the questioning member with “yes or no?!” (“yes or no”). Members of Parliament usually don’t allow him to express more than “yes” or “no”, and don’t want to give him more opportunities to add explanations.
We’ve selected a dozen Q&As to present the focus and question-and-answer format of the hearing:
Zhou Shouzi’s most frequently asked questions are related to privacy protection and foreign government interference.
Ohio Republican Congressman Bill Johnson: Does ByteDance employees in China have access to TikTok user data in the United States.
Zhou Shouzi: This is a complicated issue.
Bill Johnson: Please answer yes or no.
Funded by Zhou: After TikTok’s “Texas Plan” is completed, user data in the United States will be stored locally, hosted by local partners in the United States, and will also be subject to third-party supervision.
Anna Eshoo, Democrat of California: According to the relevant laws clearly stipulated in China, the government can force companies to provide user data in some cases. How do you convince the U.S. Congress that TikTok and ByteDance can cut data cleanly?
Zhou Shouzi: Thank you for your question. I’m glad you asked this question, as I said in my opening remarks, our plan is to transfer TikTok US data to US mainland storage.
Anna Eshoo: I understand, but the Chinese government holds that data, how can you guarantee that the data will be transferred into the United States and protected?
Zhou Shouzi: Congressman, I don’t see any evidence that the Chinese government has access to this data. They never asked us, and we never offered it.
Ohio Republican Congressman Bill Johnson: Based on the previous TikTok surveillance of American journalists, can you still say with 100% certainty that neither ByteDance nor TikTok employees can use similar surveillance technology to attack other Americans?
Zhou Shouzi: First of all, I don’t agree with the statement of monitoring. This is an internal investigation.
Bill Johnson: Yes or no? Can you spy on other Americans?
Zhou Shouzi: We will protect the data security of US users and have fired relevant employees. All future issues will be fixed, this is our commitment to the committee.
Bill Johnson: I guess my question is, can I hear you answer with 100% certainty that neither ByteDance nor TikTok employees can use surveillance techniques similar to what you use on journalists to target other Americans.
Zhou Shouzi: I don’t think that’s surveillance, and we’ve given promises, including that we won’t be influenced by any government on these issues.
During the question and answer, Zhou Shouzi repeatedly mentioned the “Texas Plan”. TikTok is migrating its U.S. operating system to Oracle’s data center in Texas, and will use a complex set of company settings to ensure that its operations can be effectively supervised to dispel the doubts of the U.S. government. But the MPs present obviously didn’t buy it. Congressman August Pfluger from the Republican Party of Texas shouted directly at him: “Please change the name, ‘Texas’ is not an appropriate name, we stand for freedom and transparency, and we don’t want your project.”
Kelly Armstrong, Republican Congressman of North Dakota: The “Texas plan” is to establish a new TikTok US subsidiary, and you said that this arrangement is unprecedented. I also agree that since it requires continued US oversight of private companies, the new subsidiary board will report to and be approved by the Committee on Foreign Investment in the United States (CFIUS). CFIUS will designate relevant hires and keep in touch with Oracle as it performs its data (regulatory) function – an unusual corporate governance structure that I doubt complies with corporate law and fiduciary duty to shareholders.
The proposal would require an unprecedented integration of the U.S. government with a private company, requiring significant government resources, all in the name of keeping a social media platform that poses a serious national security threat alive. The workload of CFIUS has increased dramatically in recent years. Mr. Zhou, can you identify any similar corporate arrangements that require the federal government to expand such resources to monitor and so-called data privacy and national security risks?
Zhou Shouzi: Mr. Congressman, I am not an expert in this field. I’m sure there are some similar arrangements, but I’m not an expert on this.
Kelly Armstrong: You said TikTok invested $1.5 billion in the Texas project. But do you agree that if CFIUS assumes this role, they will need to invest a lot of human resources?
Zhou Shouzi: I can’t speak for them (CFIUS).
Kelly Armstrong: Should the U.S. government spend so many resources creating this extraordinary institutional arrangement for TikTok, especially given its privacy and national security risks?
Zhou Shouzi: Mr. Congressman, I cannot speak on behalf of this project.
Kelly Armstrong: Without CFIUS, the “Texas plan” wouldn’t work, right? It’s not going to work without the involvement of CFIUS, as you’re proposing.
Funded by Zhou: The idea behind the “Texas Project” is to build a firewall for US user data, ensuring that data is stored by US companies and supervised by US personnel. We will invite third-party monitors to monitor this. So essentially, at least as far as I know, that’s a major part of the cost of it, because you’re not only relying on us to build the infrastructure, but you’re relying on us to find and hire these vetted third-party monitors.
Lawmakers are also skeptical about the extent to which outside regulation can see through a company’s machine learning (artificial intelligence) algorithms.
California Republican Congressman Jay Obernolte: Does Tiktok’s recommendation algorithm use machine learning?
Zhou Shouzi: This may be a bit technical. TikTok has blogged a few times about this issue, after which we can show your team. Yes, the machine learning methods we use are mainly based on interest signals.
Jay Obernolte: So just by examining the code, how do you identify whether it has been influenced by a foreign government? Because the code itself is just a neural network structure with inputs, outputs, and weights, and how it is trained (this neural network), and the influence of foreign governments is an “external” factor. I hope you can give us a written reply.
(Zhou Shouzi nods)
Jay Obernolte: Checking code doesn’t solve anything. The algorithm itself is very simple and not the secret. The secret lies in the data the algorithm is trained on, and the outcomes it is asked to predict. Do you agree with this point of view?
Zhou Shouzi: No. I really think that many changes to code can be found under third-party surveillance, and with enough third-party experts, you can confirm the purpose of many codes.
From the preparation of the hearing by Zhou Zizi, to his personal salary and stocks, he was repeatedly asked, mainly related to the impact of ByteDance on TikTok.
Michael Burgess, R-Texas: Besides your attorney, was there anyone else who assisted you in preparing for today’s hearing?
Chou Funding: The hearing I prepared with my team in Washington.
Michael Burgess: Did anyone from ByteDance provide input or guidance directly to your hearing?
Zhou Shouzi: Mr. Congressman, this is a high-profile hearing, and my mobile phone is also full of well-wishes, but I am preparing for this hearing with my team in Washington.
Michael Burgess: Can you guarantee that no one from ByteDance is preparing you for today’s hearing?
Zhou Shouzi: As I said, Mr. Congressman, this is a high-profile hearing. Many people around the world have sent me blessings and advice that I did not ask for, but I am with me. The Washington team prepared for this hearing together.
Michael Burgess: Does the lawyer representing TikTok also represent ByteDance?
Zhou Shouzi: Yes, I think so.
Rep. Richard Hudson, Republican of North Carolina: Do you personally receive salary, incentives or benefits from ByteDance?
Zhou Shouzi: Yes.
Richard Hudson: How much is it?
Zhou Shouzi: If you don’t mind, I would like to keep my salary a secret.
Richard Hudson: Do you personally own ByteDance or Douyin stocks?
Zhou Shouzi: Mr. Congressman, if you don’t mind, I would like to keep this a secret.
Richard Hudson: So, your main income comes from TikTok, but there are other forms of income from ByteDance, right?
Zhou Shouzi: You can say that.
Rep. Morgan Griffith, R-Virginia: Mr. Zhou, you were not completely honest with us today. Senator Hudson asked you before, do you hold ByteDance stock, you said you don’t want to say. We tried to find out the connection between TikTok and ByteDance. I won’t ask how many shares you have, but do you have ByteDance shares?
Zhou Shouzi: Yes, I have.
Morgan Griffith: What about the TikTok stake?
Zhou Shouzi: Currently, all employee-owned shares are in one entity.
Morgan Griffith: I guess I just don’t understand why you didn’t tell Senator Hudson this sooner rather than put us through this struggle.
You keep talking about how to build a firewall between TikTok and ByteDance, and at the same time you share a legal team, which means that anything you say to the legal counsel can be shared internally… Maybe you are in the law firm All hired two different teams of lawyers, but you didn’t say that today. Today, you said that you shared a lawyer. There is no legal firewall. So if you want to work through this and be honest, there are a few things you need to do. Do you agree? Yes or no?
Zhou Shouzi: Congressman, we will study this matter.
The drama came when Mariannette Miller-Meeks, R-Iowa, began questioning. She played a short TikTok video posted 41 days ago. The video, titled “I am F,” shows a black pistol on the ground and a death threat against all members of the U.S. House Energy and Commerce Committee and the chairman of the committee.
Mariannette Miller-Meeks: We don’t allow people to use our platform to threaten or incite violence. This video has been up for 41 days, it’s a direct threat to the chairman of the committee, everyone in this room, and yet it’s still on the platform. How do you convince us that you have the ability to keep the data and privacy of 150 million Americans safe when you can’t even protect the people in this room? I think it clearly shows how vulnerable people are on TikTok.
Zhou Shouzi: May I respond to this question, Chairman?
Hearing Chairman, Washington State Republican Congressman Cathy McMorris Rodgers: Let’s move on to the next link.
At the hearing, questions about dangerous content focused on the impact on young people.
Rep. Gus Bilirakis, Republican of Florida: Your algorithm seems to be feeding harmful content directly to kids, such as the “self-harm challenge” above, even the “suicide challenge”… I know there is also the “blackout challenge” (blackout challenge) ), which will lead to the tragic death of children unconsciously…your company has ruined their lives. Even after knowing all these dangers, you still claim that TikTok is an amazing product… Would you share this content with your two children? Your technology is causing death, Mr. Zhou, is it, or is it not? Are you fully responsible?
Zhou Shouzi: Congressman, I want to start by saying that it is shocking to hear this news… (interrupted)
Mr Bilirakis: Yes or no? I repeat the question, are you responsible for TikTok’s algorithm recommending such content to users?
Zhou Shouzi: Congressman, we do take these issues very seriously… (interrupted)
Mr Bilirakis: Yes or no?
Zhou Shouzi: We do provide access for people to type anything… (interrupted)
Mr Bilirakis: Yes or no? I get it, your reluctance to answer this question and take any responsibility for your parent company – the company that owns this technology and the harm it has caused. This is very sad. That’s why Congress needs to enact a comprehensive privacy and data security law that will give Americans more control over their information and protect our children.
In this regard, the policies of Douyin and TikTok have been repeatedly compared.
Georgia Republican Congressman Earl Carter: Mr. Zhou, two-thirds of young people in our country are using your app, and they spend an average of 95 minutes on it every day. Studies have shown that TikTok is the most addictive platform…. Some of the challenges we’ve seen on TikTok are milking challenges, choking challenges, “breathing like a dragon” challenges with liquid nitrogen. I don’t know if there are still challenges on TikTok encouraging people to steal cars. As far as I know, TikTok has a sister app Douyin in China, does it have the same content? Do the above users have such challenges in China?
Zhou Shouzi: I’m glad you asked this question… (interrupted)
Earl Carter: Yes or no?
Zhou Shouzi: I’m not sure.
Earl Carter: The lady (chairman of the hearing) said you have to tell the truth, do you know if there is such a challenge on Douyin in China? In my opinion they don’t.
Zhou Shouzi: I’m not sure, because I spend all my energy on running TikTok.
Earl Carter: Are you not following any other competitors or similar products? Douyin does not have these challenges in China, but TikTok does in the US. That’s why I ask you this question, why is TikTok still unable to effectively identify such harmful videos? Why are you allowing this to continue? tell me why?
Zhou Shouzi: This is an industry-wide challenge, and we are working hard.
Earl Carter: No, it’s not an industry problem, it’s a TikTok problem. We’re talking about TikTok, why you can’t control this… You always talk about the industry, but we’re talking about TikTok, and we’re talking about the deaths of children. Do you know any children who have died because of it? Do you have any ideas?
Weekly Funding: Member of Congress… (interrupted)
Sometimes lawmakers, like their constituents, don’t quite understand how technology works. One worried about whether TikTok could obtain data from other devices on the network by connecting to Wi-Fi at home. Another worried that TikTok would film the state of pupils.
Earl Carter: I’m going to change the subject now and talk about biometrics. Can you be 100% sure that TikTok is not using a phone camera to determine if the video content is causing the user’s pupils to dilate, thereby helping the algorithm promote this video?
Zhou Shouzi: We do not collect body, face and voice data to identify users. TikTok will only collect facial data when the user turns on the facial filter. For example, adding a sunglasses filter to the user’s face requires determining the position of the eyes. And this data will only be stored on the user’s mobile phone, and will be deleted immediately after the filter is used.
Earl Carter: I have a hard time trusting you. (If TikTok does not collect body, face and voice data) How does TikTok determine the age of users?
Weekly Funding: We determine by Age Gating. We ask users how old they are. We have also created some tools to determine through the public information and videos posted by users.
Earl Carter: This is kind of scary, tell me more about this.
Zhou Shouzi: These are all public information. If you choose to post a video, it’s there to be seen. We use these videos to determine whether the age claimed by the user is true. This is a common challenge in the industry, and the trade-off between user privacy and age confirmation is a major issue.
Two crises in three years: Trump hit a wall, Biden made more thorough preparations
In August 2020, three months before the U.S. presidential election, Trump said he would ban TikTok in the U.S. unless ByteDance split it up and sold it to a U.S. company. To this end, Trump issued two executive orders requiring ByteDance to spin off and sell TikTok, otherwise the product will be banned.
The executive order of the President of the United States has legal effect and can be issued quickly without going through the legislative process of Congress. But presidential executive orders also need to have a legal basis and may be overturned by the courts for breaking the law.
Trump’s executive order cited the “International Emergency Economic Powers Act” (IEEPA), requiring US telecom operators and app stores to stop business dealings with TikTok, thereby implementing the ban on TikTok. The bill allows the president to bar U.S. companies from having any transactions with certain foreign entities after declaring a national emergency — which Trump already did in 2019.
However, the decree, which seems to have far-reaching effects, has also been restrained. In the amendments to IEEPA, the U.S. Congress made it clear that the powers it conferred on the President cannot be used to restrict “personal communications without value exchange” or the import or export of “information and information materials”, whether through “direct or indirect” means .
In response to the legal loopholes in the executive order, TikTok and three TikTok influencers sued the Trump administration successively. A federal judge in the case issued a preliminary injunction in late September, blocking Trump’s executive order. On the one hand, the Trump administration continued to appeal the preliminary injunction, and on the other hand, it took the initiative to postpone the implementation of the spin-off executive order based on the progress of ByteDance’s sale of TikTok.
If Trump had more time, he might well have reached his goal, too. When he took office in 2017, he issued an executive order restricting citizens from many countries from entering the United States, and was stopped by the court within two days. Afterwards, Trump issued a new presidential decree and civil rights organizations pushed for lawsuits. After more than a dozen rounds of confrontation, Trump finally achieved his goal at the end of that year. But within a few months of issuing the executive order on TikTok, Trump lost the election and left the White House.
In 2021, after Biden took office, he withdrew Trump’s executive order to ban TikTok. This does not mean TikTok is safe.
Biden, who has held public office for more than 50 years, is more accustomed to following a process and is more prepared to advance his goals. While withdrawing Trump’s executive order, Biden ordered the Secretary of Commerce to lead a comprehensive security review of adversary state-controlled apps. Five months later, the Biden administration proposed changing Commerce Department rules to bring apps under its purview. In September 2022, Biden issued an executive order instructing the Committee on Foreign Investment in the United States (CFIUS) to pay attention to its “risks to sensitive data of US users” when reviewing foreign investments.
During this period, the relationship between ByteDance and TikTok, and Byte China employees’ access to TikTok’s US database have been widely reported on many occasions.
In December 2022, in the last three weeks before Congress adjourned, a government spending bill that was sure to pass contained a decree banning federal employees from using TikTok on government-issued devices. Biden welcomed it and signed it into effect. In February of the following year, the White House issued a memorandum to US federal government agencies, requesting that within 30 days to ensure that TikTok would no longer appear on government devices. Prior to this, the U.S. military and the Transportation Security Administration (such as airport security officers) have banned employees from installing TikTok on official mobile phones.
In March 2023, the European Commission, the European Council, and the European Parliament successively banned employees from using TikTok on their official mobile phones, citing concerns about TikTok’s data security. At present, countries following this policy include the United Kingdom, Denmark, Belgium, as well as Canada and New Zealand. Australian cyber security experts have also called on the federal government to “take it seriously”.
The US state of Montana has gone one step further than the federal government. Its Senate voted in March to pass a statewide ban on TikTok. If the ban is subsequently approved by the state House of Representatives and the governor, it will also create a precedent for state ban applications in the United States.
A more deadly threat is a nationwide ban. Beginning in February 2023, the House of Representatives and the Senate will introduce their own bills. The former (DATA Act) allows the Secretary of the Treasury to block platforms on the grounds of possible data leakage; the latter (RESTRICT Act) allows the Secretary of Commerce to prohibit foreign adversaries from threatening the ICT industry. Investment in national security.
Both bills open up new ways for the U.S. government to ban TikTok and are awaiting votes in both chambers. The RESTRICT Act has bipartisan support from lawmakers, including support from the Biden administration.
At present, TikTok has failed to find new support in the United States. American civil rights organizations that opposed the ban on TikTok in 2020, such as the Electronic Frontier Foundation (EFF) and the American Civil Liberties Union (ACLU), continued to oppose relevant legislation on the grounds that the government threatened freedom of speech.
TikTok’s largest external supporters in the United States are still its own users and creators. However, according to US media reports, after the impact of 2020, creators on TikTok mostly operate short video content simultaneously on the platforms of Google and Facebook.
In the window period of more than two years, TikTok has won more users, but it has not yet become indispensable
Whenever Zhou Shouzi talks about TikTok’s regulatory issues at the ByteDance staff meeting, he always mentions a word: “trust” (trust). And inside TikTok, he will say another word: “indispensable” (indispensable, essential). “TikTok must become an indispensable partner for users, creators, and partners (advertisers, e-commerce merchants).” A TikTok person analyzed that this is an important weapon for a product to deal with competition and regulation. In China, Douyin has the same plan.
Compared with the end of 2020, TikTok has become bigger in the United States. According to “LatePost”, the number of daily active users of TikTok in the United States has reached 80 million, an increase of 60% compared to two years ago. For a product that’s only been around for five years, that’s no small feat. Facebook, the largest social networking product in the United States, has 180 million local daily active users.
According to the established goal, TikTok’s overseas penetration rate must reach the same level as Douyin’s penetration rate in China. With 750 million daily active users, the penetration rate of Douyin (including the extreme version and the volcano version) in China has reached about 54%, while the penetration rate of TikTok in the United States is only about 24%.
“TikTok’s growth in the United States has entered a bottleneck period.” A TikTok source said that the number of daily active users has gradually stabilized. In the past three years, Instagram and YouTube have also launched online segment video functions in their products.
TikTok also does not have sufficient commercial interests in the United States. According to data from the US research company Insider Intelligence, Meta, Google and Amazon will account for more than 60% of the US advertising market in 2022, while TikTok has a significant gap with them. In the United States, an active short video user still brings less advertising revenue to the platform than a social network user. Not only is the monetization efficiency of TikTok ads lower than that of Facebook, but Zuckerberg also said in a financial report that his short video ad monetization efficiency is also lower than that of social ads.
The progress of TikTok e-commerce in the United States is even slower-it will not launch live e-commerce in the United States until the end of 2022, later than when it enters the United Kingdom and six Southeast Asian countries. A TikTok e-commerce source revealed that the double pressure of regulation and competition caused TikTok e-commerce not to choose the United States in the first place. In other developed markets, TikTok has also failed to reproduce the domestic live broadcast e-commerce boom.
According to “LatePost”, because of this regulatory crisis, TikTok e-commerce decided to slow down the pace of expansion in 2023, especially in the US market. The plan to enter Brazil and Spain and other European countries originally scheduled for the first half of the year will be postponed to the second half of the year.
The geopolitical situation has changed faster than TikTok expected, and it clearly hadn’t become a truly “indispensable” product before this crisis hit. In order to win the trust of the US government, TikTok has made many attempts in the past three years.
Lobbying is one of the important means. TikTok started lobbying in the United States as early as 2019. At that time, the Committee on Foreign Investment in the United States began to investigate TikTok at the request of several members of Congress, looking for evidence that it passed US user data back to China. This year, ByteDance hired 17 experts to visit the Ministry of Commerce, the White House Office and other institutions, and spent $270,000 trying to reverse the unfavorable situation.
However, the effect of lobbying is relatively limited. Taking 2020 as an example, ByteDance’s lobbying expenses in this year have increased tenfold year-on-year, and even used half of the lobbying team to contact members of Congress, trying to change a sentence in the HR 1140 bill of the House of Representatives that “prohibits transportation security administration employees Using or installing the video social media app TikTok on government-issued mobile phones” was ultimately unsuccessful.
According to “LatePost” statistics, ByteDance’s lobbying spending in the past three years has exceeded Huawei’s spending in the United States in the past ten years. In 2022, its lobbying expenditure will be as high as US$5.38 million, about 1.7 times that of Huawei. According to recently disclosed information, the new wave of lobbying by ByteDance in the second half of 2022 involves bills including:
- National Defense Authorization Act for Fiscal Year 2023
- Consolidated Appropriations Act 2023 (Consolidated Appropriations Act, 2023)
- No TikTok on Government Devices Act
- James M. Inhofe National Defense Authorization Act for Fiscal Year 2023
TikTok is also trying to divide the operating systems of various regions in exchange for the trust of local governments. In a project called the “Texas Project” by TikTok, the company is trying to migrate its US operating system to Oracle’s servers in Texas and allow Oracle to supervise the inflow and outflow of US user data.
As part of the “Texas Plan”, TikTok also established a wholly-owned data security subsidiary in the United States (Tiktok US Data Security Inc.) to take over operations that have aroused government concerns, such as content recommendation algorithm maintenance and user personal data management. The code of the recommendation algorithm and the procedures for accessing user data will be independently audited by Oracle and another third-party organization.
In order to weaken ByteDance’s control over the new company, the board of directors of the new company was nominated by TikTok, reviewed by CFIUS and reported to CFIUS. Employees of the company must be US citizens or US green card holders, and they can also be investigated by CFIUS.
TikTok expects to spend $700-100 million a year because of the “Texas plan”, and this cost will expand with user growth in the future.
Despite the various security measures adopted by the “Texas Plan”, the US government still has doubts. After TikTok submitted the “Texas Plan” proposal, media reports said that representatives of the Department of Defense and the Department of Justice who participated in the review believed that only by forcing ByteDance to sell TikTok can national security be ensured. Biden clearly listened to them.
Zhang Yiming, the founder of ByteDance, has firm ambitions for globalization. Compared with Facebook, which places more emphasis on market potential and commercial benefits, ByteDance “want to grow bigger all over the world, even if it doesn’t make much money.” A ByteDance person close to the group’s senior management said.
以印度为例，这是一个对中国企业不友好且极难挣钱的市场——视频业务有巨大的服务器成本，哪怕TikTok 在当地不打任何广告、不养任何团队也还是会亏损。上述字节跳动人士认为，换做Facebook，不做就不做了，“但字节跳动依然要坚持尝试投入。”
2022 年起，字节跳动也从国内业务中抽调了越来越多的中坚力量支援TikTok ，其中包括曾深度参与抖音建设的抖音原市场负责人支颖、今日头条原负责人陈熙。《晚点LatePost》获悉，抖音电商副总裁木青也将在近期转岗至TikTok 电商。
多位知情人士透露，抖音集团CEO 张楠已将工作地搬往新加坡。就在几个月前，这位抖音最重要的缔造者将自己一把手的身份交给了韩尚佑，后者曾任抖音直播与生后服务业务负责人。2023 年1 月，张楠还在朋友圈表达了对CapCut 的赞赏。这是字节跳动旗下一款面向海外的视频剪辑工具，彼时它的全球日活跃用户突破了8000 万。
字节跳动从没来由放弃过对全球化的追求。2020 年底，TikTok 危机刚过，就加速上线了TikTok 电商业务。这个项目最初在内部的代号是“麦哲伦XYZ ”。XYZ 来自17 世纪数学家笛卡尔的著作《几何学》，代表未知量；而麦哲伦则是首次完成环球旅行的葡萄牙探险家，代表着字节跳动即将再次开启征途。
2012 年，美国国会众议院情报委员会在调查另一家跨国公司的安全问题时也举行了听证会，一位议员说，“作为情报委员会，我们需要在威胁发生前，就对美国公司和美国公民发出警报，而不是像9/11 那样，等威胁成真再反应。” 他更在意可能性，而不是已经发生的事实。一家跨国的商业公司几乎不可能杜绝这样的可能性。
TikTok 接下来的境遇可能是一个样本，帮助我们看清两个竞争中的大国、两个有诸多差异的社会，究竟能维持何种程度的商业合作。
题图来源：视觉中国
本文转自： https://www.latepost.com/news/dj_detail?id=1568
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