TikTok’s Chinese owners are rapidly expanding, posing serious national security concerns.
The China-based umbrella company that owns TikTok is making some aggressive expansions. ByteDance purchased one of China’s largest private hospital networks Amcare Healthcare on August 10. Data analytic firms have discovered the company owns 70 different apps and invests heavily in a Shanghai-based cafe chain and a China-based lemon tea brand, according to Forbes.
The company even quietly launched its own China-exclusive search engine this month without much fanfare, according to South China Morning Post.
“ByteDance lists just seven products, including TikTok and its Chinese counterpart, Douyin, on its website. But ByteDance is pushing into at least half a dozen other industries at a shocking scale, snapping up everything from video game startups to medical websites and payment processors, even dabbling at one point in education apps and real estate listing businesses,” says Forbes.
ByteDance only opened in 2012 and it has expanded into one of China’s most aggressive private companies with hands in app development, software development, health care, virtual reality, social networking, gaming, and education.
Why it’s important
ByteDance has significant ties to the Chinese government, and its expansion may have national security implications. The company’s aggressive expansions and connections to the government have caused multiple political controversies, while leakers from within TikTok and ByteDance have repeatedly raised alarms about the company’s access to American data.
At least 300 ByteDance have been discovered to have worked for state-control media. This isn’t necessarily a conflict of interest, as moving between public and private business can be a typical career path, as Forbes notes.
“But for a company already under close scrutiny for its ties to foreign governments, the additional connections through employees are likely to raise questions.”
Last year, anonymous recruiters working for TikTok told CNBC that they were concerned about the influence of their parent company, “which they say has access to American user data and is actively involved in the Los Angeles company’s decision-making and product development.”
Buzzfeed Needs reported in June that ByteDance has repeatedly accessed nonpublic data from TikTok. It then reported again in July that ByteDance used the “TopBuzz” app to spread Pro-China propaganda, saying “the allegation that ByteDance actively inserted pro-China messages into one of its apps raises another regulatory concern about TikTok: that ByteDance could use TikTok in a similar way to influence public discussion in the United States (or elsewhere) in order to benefit China’s authoritarian government.”
Backing up a bit
President Trump attempted to ban TikTok in the US following similar allegations in September 2020. The order was revoked by President Biden, under the criteria that the risk of apps being connected to foreign adversaries is taken into consideration.
TikTok is one of the most popular social media apps, with 175 million downloads as of March 31, 2022.
“ByteDance becoming large enough to receive attention and potential investment and the kind of golden-share deal that the Chinese state has with Tencent is [cause for concern]. The larger a Chinese company gets, the more important it is to the Chinese economy, and therefore the Chinese Communist Party and the state — because the Chinese economy is essentially an extension of the state,” says Cato Institute policy analyst Will Duffield.