TikTok emerges as Silicon Valley's scapegoat in Washington
TikTok offers Silicon Valley CEOs a chance to wrap themselves in American values on market dominance, data privacy and online speech.
The wildly popular video-sharing app TikTok may not be the competitor that Silicon Valley wants, but it could provide what the U.S. tech industry needs right now — a Chinese-owned foil to divert the ire of lawmakers in Washington.
The Gen Z favorite is causing existential strife among established social media titans, as TikTok’s quirky platform has begun to outcompete the likes of Facebook, Instagram, Twitter and YouTube in app downloads and buzz among younger users. Yet TikTok also offers Silicon Valley CEOs like Mark Zuckerberg a chance to wrap themselves in American values on market dominance, data privacy and online speech, at a moment when U.S. tech companies are more beleaguered than ever in Washington.
"It certainly diverts attention, negative attention, from the U.S. platforms," said Robert Atkinson, president and founder of the Information Technology and Innovation Foundation. "The mob is shifting, if you will, over to a new target. And TikTok is a juicy, ripe target to go after."
The newfound focus on TikTok and its Beijing-based parent company ByteDance most notably includes a national security review being conducted by the Trump administration. And, though TikTok declined to appear, scrutiny of the company proved the main theme of a highly critical, if sparsely attended, hearing before a Senate Judiciary subcommittee on Tuesday.
Here are some of the tech policy debates where the rise of TikTok is proving timely:
Critics accuse Facebook, Google and Twitter of failing to appropriately moderate content on their platforms, particularly controversial political speech. Democrats say they're too permissive of lies, hate speech and harassment, especially from President Donald Trump and his supporters, while Trump and other Republicans say they're too eager to censor conservatives.
Now the companies can point to TikTok as an example of how not to handle online speech, as lawmakers like Sen. Josh Hawley (R-Mo.) — who chairs the panel that held Tuesday's hearing — raise fears the company is bowing to censorship pressure from Beijing.
"I would bet that Facebook is having a field day with this," said Samm Sacks, a cybersecurity policy and China digital economy fellow at New America. "At the very moment when Mark Zuckerberg and the company has been under immense scrutiny here at home, we now have a perfect foil. You don't trust Facebook? Well, just look at TikTok. It's brilliant."
Zuckerberg has already spent weeks warning that free speech is in danger if China sets the terms of online expression.
"China is building its own internet focused on very different values, and is now exporting their vision of the internet to other countries," he said during a speech at Georgetown University last month, throwing a red flag to critics clamoring for U.S. regulators to hobble Facebook’s power and influence. "Until recently, the internet in almost every country outside China has been defined by American platforms with strong free expression values. There’s no guarantee these values will win out."
While dissidents around the globe use Facebook's messaging service WhatsApp to communicate, TikTok has faced accusations that it censors mentions of the anti-government protests roiling Hong Kong, Zuckerberg noted.
"Is that the internet we want?" he asked.
TikTok disputes such accusations. Before Wednesday’s hearing, its U.S. general manager, Vanessa Pappas, sent a letter to committee members asserting the platform's independence from the Chinese government, writing that the company does not "remove content based on sensitivities related to China (or other countries)."
"We [have] never been asked by the Chinese government to remove any content, and we would not do so if asked," she wrote.
A TikTok spokesperson added: "The more Mark Zuckerberg has come under scrutiny, the more TikTok has shown up in his speeches, interviews and op-eds. You would have to ask him if this is pure coincidence."
At Tuesday's hearing, Hawley proved skeptical of that claim, calling on TikTok to "now appear under oath to tell the truth about their company."
Still, the lawmaker told reporters after the hearing that he's not inclined to give Facebook and other tech heavyweights a pass in the face of Chinese competitors.
"Thankfully, they're not the Communist Chinese government, but I don't know that they're exactly good actors, either," Hawley said of U.S. tech platforms.
Mishandling sensitive user data
TikTok's Washington woes are not limited to Capitol Hill. The Trump administration is reported to be probing potential national security risks stemming from ByteDance's 2017 acquisition of the app Musical.ly, a deal that helped create TikTok in its current form and precipitated its surge of popularity in the U.S.
It's part of broader criticism of Chinese technology behemoths that has festered in Washington for years and is now exploding amid Trump's trade war with Beijing. Citing national security concerns, the Trump administration has slapped Chinese telecommunications giant Huawei with trade sanctions.
The anxiety around TikTok centers in part on fears that the data it collects on its U.S. user base could make its way to the Chinese government. "When aggregated, the data could be useful in improving Chinese machine learning tools to help China better understand, predict and manipulate the behavior of Americans," said Jim Baker, a former FBI general counsel who is now director of national security and cybersecurity at the R Street Institute.
Facebook and other tech giants have faced criticism for obscuring their own uses of consumer data and failing to handle it securely. The leak of Facebook data to political consulting firm Cambridge Analytica before the 2016 election yielded a record $5 billion Federal Trade Commission fine and helped inspire national calls for data privacy legislation.
Nevertheless, Silicon Valley may now find itself positioned as the transparent alternative to China.
"Instead of importing the values of censorship and control to the U.S., we should be exporting our values of openness and transparency to them," Kara Frederick, a fellow at the Center for New American Security who previously worked at Facebook, said at the hearing.
TikTok says it stores data from its American users only in the U.S. and Singapore and doesn't even have data centers in China. But that doesn't satisfy critics like Hawley, who maintain it would be a trivial matter for Beijing to demand the company hand over data anyway.
All the same, questions about TikTok's data privacy practices are a reminder that China does not adhere to existing global privacy standards and that its own data governance rules are "very much a work in progress," said Paul Triolo, who heads the geo-technology practice at political consulting firm Eurasia Group.
"If China remains outside of these regimes, Chinese firms, not just ByteDance/TikTok, but bigger players like Alibaba, will indeed be used increasingly as foils around D.C. debates on data privacy," Triolo said.
Upending big tech's market dominance
When Facebook was called to testify in July before a House antitrust subcommittee on the state of internet competition, then-public policy director Matt Perault identified TikTok among the rivals nipping at its heels. The fast-growing social network is already proving to be a primary exhibit as Facebook makes a case for why it doesn't have a monopoly on social media.
"It plays on their side politically because it does show, again, competition is real," said Atkinson at ITIF. "It can happen very quickly and it can certainly be Chinese competition, which we're going to have to grapple with."
Facebook Chief Operating Officer Sheryl Sandberg made similar points in media interviews earlier this year, arguing that dismantling Facebook, as some Democrats want to do, could leave a vacuum for Chinese counterparts to enter. Already, Chinese firms like Alibaba, JD.com, Tencent and Baidu rank among the world's largest internet companies.
Since then, federal and state antitrust enforcers have nevertheless launched investigations into both Facebook and Google.
“On the one hand, I think it’s absolutely a legitimate concern that if you don’t have U.S. companies playing a big role, if you were to break them up, et cetera, you could have voids which could well be filled by Chinese companies, which could create serious problems," said Ed Black, president and CEO of the Computer & Communications Industry Association, whose members include Google, Facebook and Amazon.
"Having said that, it shouldn't be a basis to excuse legitimate inquiry and scrutiny of companies," he added.
Silicon Valley's own China ambitions
The debate around TikTok may also renew gripes about American internet firms largely being excluded from the lucrative Chinese market, even as Chinese rivals gain a foothold in the United States . American firms have been eager to expand into China but have stayed out — or been kept out — due to censorship concerns and other barriers to entry.
“This is a very salient issue and will become even more so as other Chinese social media and e-commerce platforms expand outside of China, even as .... most regulators assume the Chinese government will have some access to data collected by Chinese companies,” Triolo said.
Heritage Foundation tech policy lead Klon Kitchen noted at Tuesday's hearing that under a Chinese law that takes effect in the new year, foreign firms doing business in the country will also have to comply with government data demands.
Google already sustained sharp criticism from lawmakers this year after reports surfaced that it had worked to build a censored search engine, dubbed Dragonfly, to comply with the Chinese government's demands. Google’s vice president of public policy, Karan Bhatia, told a Senate Judiciary panel in July that project had been terminated.
The rise of TikTok and the reported national security investigation are bound to draw more attention to what it takes to do business as a tech company in China. And on that front, Silicon Valley may struggle to use the upstart social media firm as a scapegoat.
“The TikTok investigation will undoubtedly spark new debate about how and whether Google could reenter the China market,” Triolo said.
Cristiano Lima contributed to this report.