Ásia, Deutsche Welle, Inglês


For Sale: One of the world’s most successful social media platforms with a billion users across 140 countries.

Sounds like a good deal for someone with ambition and money. But Chinese-owned TikTok isn’t just any short-video-sharing app. It is a phenomenon changing social media and how people communicate.

Claims of national security concerns in the US don’t make things any easier. Plus protectionist attitudes and sentiment on China in general have turned dark and Congress is moving fast to force the company’s hand.

US Congress in control?

The US government now sees TikTok as more than entertainment — it is a news and information platform that can be used for propaganda, too. For decades, the US had restrictions on foreign ownership of traditional media like radio or cable stations; for policymakers restrictions on TikTok are a logical 21st-century consequence.

On Wednesday (April 24), US President Joe Biden signed a bill aimed at forcing
a change of ownership of TikTok into law after the US Senate approved it by a large margin.

TikTok may be waiting for a knight in shining armor to save its US business. Yet the pool of available buyers is small and Elon Musk is already busy reworking X, formerly known as Twitter. Who else can they turn to? What will happen to the 170 million US users if TikTok just can’t be sold?

What makes the TikTok algorithm so effective?

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A short history in 60 seconds

This isn’t TikTok’s first time on the possible selling block. Donald Trump tried with an executive order to force ByteDance, the owner of TikTok, to sell the subsidiary to an American owner back in 2020.

It seemed a deal with Oracle was close, but those efforts failed, as did an attempt to keep the app out of app stores. 

Since then TikTok says it has gone to great lengths to delete the data on American users from ByteDance servers and move all that information to US-based servers, a move it calls Project Texas. This should in theory keep the data out of the hands of Chinese surveillance.

Many experts like Milton Mueller, a cybersecurity expert at the Georgia Institute of Technology in Atlanta, doubt there is any real security threat after having looked at all the evidence. Still, many US politicians and government intelligence and security agencies don’t seem appeased and want to take it to the next level. 

TikTok CEO Shou Zi Chew speaking in a microphone at the US Congress
In March, TikTok’s Singaporean CEO Shou Zi Chew had to defend the company in the US Congress Image: Jim Watson/AFP

Who would want to buy TikTok?

With all that in mind, buying all — or just the American part — of TikTok would not be a usual business transaction. It would be a geopolitical minefield. Would ByteDance still be a majority shareholder calling the shots in the background? Who would run and update its powerful algorithm?

Mueller, who looks at TikTok several times a week, thinks a sale is “theoretically possible but highly complicated and not likely.” Adding that “China’s government might not allow it, and it is unclear what is gained, or even what it means, to sell ‘part’ of a globally interconnected social media service.”

ByteDance seems ready for a legal fight. For its part, the Chinese government has been restrained. But they could try to prevent a sale by putting an export ban on the technology behind the app. Without its algorithm, TikTok would be less attractive.

Besides that, it is hard to put boundaries and prevent access to something as free-flowing as an app. App stores would have to block all new downloads and updates for those who have it already.  

There is also a short timeline. Mueller has talked with a number of TikTok people recently who say as a technical or operational matter divestiture doesn’t work in such a short period. They would have six months, “whereas the Grindr divestiture from a different Chinese company took a year,” he said.

A big big-ticket item

The challenges just pile up. Any ban in America would surely lead to First Amendment constitutional challenges. “It would be US users whose speech would be suppressed, not foreigners or the Chinese government,” Mueller said. 

Then there is the price. Several analysts think that despite all the difficulties TikTok’s US business could sell for over $50 billion (€45.8 billion). There are only a few companies that could afford to spend that much like Apple, Amazon, Google, Meta, Microsoft or Netflix.

Some of these companies would then end up in the crosshairs of antitrust officials for owning too much important technology.

Alternatively, all or part of TikTok could be spun off as an independent publicly listed company. Or US-based private equity giants could step in.

After the House of Representative vote in March, former Treasury Secretary Steven Mnuchin, said he is working to put together a group of investors to take over the company without announcing any details. Ironically, Mnuchin was one of the people pushing for a sale four years ago while he was a member of Donald Trump’s Cabinet. 

US House passes bill that could ban TikTok

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It is likely not about apps at all

Yet, in the end, it is not about good business or even national security says Milton Mueller. “It is a pawn in the broader US-China power competition, and it is also exploited for symbolic reasons.”

“Equating a commercial social media app with espionage, and calling TikTok’s Singaporean CEO an agent of the Chinese Communist Party, is obviously inaccurate,” but sells well to both Republicans and Democrats “who see the US as engaged in a competition with China to retain US hegemony,” he said.

Forcing an ownership sale would also set a dangerous precedent that could be used by other governments against US social media companies.

In the end, Mueller expects such digital protectionism to lead to “less competition and innovation in the social media market.” And there is always the next national security threat. Perhaps Chinese-made electric vehicles or battery systems? The retaliation may never end.

So, anyone interested?

Edited by: Uwe Hessler


Deutsche Welle


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