TikTok owner ByteDance a hybrid Chinese state entity, report warns

A report submitted to the Australian Senate says ByteDance, the Chinese company that owns TikTok, should be called a “hybrid” state-private entity because it cannot be considered to be private and independent.

The administration of US president Joe Biden has demanded that TikTok parent company divest itself of its stakes in the popular video app or face a possible ban in America. Other countries have already implemented a partial or complete ban of the popular social media platform.

A report by a quartet of researchers just submitted to Australia’s Senate Select Committee on Foreign Interference through Social Media, says ByteDance is “intertwined” with the government in Beijing.

This claim in itself wouldn’t be too big a deal, but the report has already been hailed as “the most comprehensive exploration yet of Chinese Communist Party (CCP) ties to TikTok” by Brendan Carr, commissioner of the US Federal Communications Commission.

TikTok bans worldwide

• The US government's Committee on Foreign Investment in the United States, a powerful national security body, in 2020 unanimously recommended ByteDance divest itself of TikTok because of fears that user data could be passed on to China's government
• In early March, legislators from both major US parties introduced a bill to ban the popular app in the United States. Congress previously passed a bill in December to ban TikTok on federal devices
• That month, Belgian federal government employees will no longer be allowed to use TikTok on their work phones
• New Zealand banned using TikTok on devices with access to the parliamentary network
• The UK said it would ban TikTok from all government phones and devices due to security concerns, after Canada issued a similar measure
• The EU's executive arm, the European Commission, has issued an order to ban the use of TikTok on staff phones, as has the European Parliament
• India banned TikTok and dozens of other apps by Chinese developers on all devices in 2020, claiming that they were potentially harmful to the country's security

Control tool?

“Many of our references point to Chinese-language sources that have been overlooked by the public debate to date. Some of our most important sources have been excavated from digital archives after being taken offline by TikTok’s parent company, ByteDance, or authorities in the People’s Republic of China,” authors of the report (PDF) say.

Researchers say the most significant findings contradicting TikTok’s public statements relate to how its capabilities may be integrated with what Beijing describes as “external discourse mechanisms.”

In other words, even though TikTok is usually generating attention for its potential use as a data access and surveillance tool, the report notes the lack of discussion of “how TikTok provides Beijing with the latent capability to weaponize the platform by suppressing, amplifying, and otherwise calibrating narratives in ways that micro-target political constituencies abroad.”

According to the report authors, who quote Mandarin-language sources, the Chinese government and specifically its leader Xi Jinping in essence betrayed their intentions by blocking TikTok in China while enabling it to grow rapidly in other countries.

TikTok is now one of the most popular apps worldwide, and recently reached one billion active users. Again, the report stresses that this is what Xi wanted – in 2021, the People’s Daily called for China to “allow short-video platforms to become ‘megaphones’ for telling Chinese stories and spreading Chinese voices well.”

Various countries, especially in the West, have been moving against TikTok in recent months – even though reasons behind the antipathy towards it could be related to geopolitics.

The app has been banned on government-issued devices in the UK and New Zealand, for example, while US legislators from both major parties introduced a bill to ban it nationwide, as the Biden administration demanded that ByteDance divest itself of its stakes in TikTok.

More pro-CCP content

Any countrywide ban would be problematic, though, since TikTok is popular with millions of young people. In the report, Gina Raimondo, the US Secretary of Commerce, is quoted as commenting on the possibility of a TikTok ban in America to Bloomberg: “The politician in me thinks you’re gonna literally lose every voter under 35, forever.”

However, “in the absence of policy action, TikTok could be the next challenge to democracies’ resilience against authoritarian interference. As ever, the challenge is to deal with the potential for foreign interference before ‘elite capture’ becomes ‘state capture’,” the report says.

It adds that ByteDance, a TikTok parent company, is actually “bare bones” and lacking detail about the company’s founder, corporate structure, or partners. In truth, ByteDance owns a suspicious TikTok clone Douyin – an app available in China.

“TikTok claims to be its own insulated entity, but our research indicates that TikTok and Douyin share personnel and technological resources, have parallel management structures, and permit data sharing with each other,” researchers say.

Finally, ByteDance does not publicize that its editor-in-chief, Zhang Fuping, is also its Communist Party Secretary – many companies in China are required to have an internal CCP committee. In the report, Zhang is quoted as saying this about his mission: “Transmit the correct political direction, public opinion guidance, and value orientation into every business and product line.”

“Our original content analysis reveals higher proportions of pro-CCP content and political misinformation on TikTok than on some other platforms. ByteDance has a demonstrated capacity to develop automated content filters, calibrate content distribution, and adopt norms in service of Party propaganda,” says the report.

Ban better than sale

Australian press has already been reporting that Clare O’Neil, the Home Affairs Minister, is about to announce a TikTok ban on government-issued devices.

However, even though the aforementioned report appears to be thoroughly prepared, its authors admit in a disclaimer that they have relied on a “wide range of online and other publicly available sources.”

This means the report doesn’t contain anything previously unreported. Besides, the following sentence simply cannot sound serious: “We consider our analysis to be sound and factual, and present it in the good faith belief that it is, but we are not in a position to independently verify the accuracy of the information contained in any public records.”

On the other hand, the quotes or lines from official Chinese sources are real, and they can indeed signal Beijing’s willingness to retain control of TikTok at any cost.

Already in 2020, the CCP said it would counter any US attempt to force ByteDance to rid itself of TikTok – Reuters quoted sources saying that the Chinese authorities would rather see TikTok shut down than forcibly sold.

“The attempts to regulate or restrict TikTok in 2020 revealed the CCP’s interest in retaining

control over the app. So long as that is the case, TikTok poses risks to democracies,” said the report.