What is Tiktok? Who owns it, and is it getting banned?

ByteDance is a Chinese-owned tech giant, founded by Zhang Yiming in March 2012. Zhang Yiming is an entrepreneur who is now the ninth richest person in China due to the success of the company’s portfolio of apps worldwide.

And Bytedance owns TikTok, right?

Yes, the most famous of ByteDance’s apps are short-form video platforms TikTok and Douyin (TikTok’s Chinese counterpart).

Douyin was founded in 2016 and has built up a network of over 600 million daily active users. Meanwhile, TikTok was launched in the US in 2018 after it merged with lip-sync video platform Musical.ly, which ByteDance purchased for US $1 billion. TikTok is now available in 155 countries and achieved over 2 billion downloads.

ByteDance also owns several popular apps within the domestic market, including Toutiao. Toutiao is a news aggregator platform powered by artificial intelligence and has over 120 million daily active users. One of the earliest apps created by ByteDance was Neihan Dianzi, a platform that enabled users to share jokes through videos, memes or text, but which was subsequently shut down by Chinese authorities in 2018.

Internationally, ByteDance owns Indonesia’s news aggregation app BaBe, Helo an Indian social media app, and TopBuzz, a platform that recommends trending videos and articles to users.

Why was there talk of it being banned? Was it banned? 

TikTok was banned in India in June along with 58 other Chinese apps because of tensions along the India-China border. The Indian market accounted for 30% of the app’s total global downloads.

On August 6, the tech battle between the US and Chinese governments intensified when US President Donald Trump signed an Executive Order announcing that he would ban US businesses and citizens from doing business with or downloading TikTok 45 days later.

The move came after the Trump administration aired concerns about user data being shared with Chinese authorities, a claim that ByteDance denied. However, the ban did not come into effect after a US District Judge ruled to temporarily halt the ban on TikTok downloads. ByteDance nevertheless signed a deal with Oracle and Walmart which gave the two companies a 12.5% and 7.5% stake respectively in TikTok Global, the new company focused on TikTok’s worldwide operations. Trump approved the deal but, considering the ban has been halted by the courts, there is uncertainty about the future of the ByteDance deal.

Might it be banned in the UK?

While other countries, including the UK, have expressed concerns about the security of users’ data when it comes to Chinese tech companies, it is unlikely that ByteDance will face a ban like the one suggested in the US. TikTok has recently shown a willingness to cooperate with British authorities in addressing privacy concerns after inviting parliamentary committees to visit TikTok’s offices to analyse its algorithms.

Furthermore, it has been suggested that the bans on Chinese technology products was used as leverage during the run up to the US election in a bid to gain favour among certain voters through extensive press coverage.

Due to close relationships with both China and the US, the UK was put in a precarious position to act, although it is unlikely that the new president-elect will continue the politics of his predecessor.

Will it be sold to an American company?

As far as ByteDance can avoid doing so, it will not sell the full stake of TikTok Global, and any deal will certainly not reveal the “source code”, i.e. the algorithm that is the secret to the platform’s success. The current deal with Oracle and Walmart is believed to be satisfactory for ByteDance because it only concedes a 20% stake in the company, meaning that it maintains its role as majority shareholder.

Also, there is no longer an imminent need to concede to the US, as Donald Trump’s ultimatum was essentially met.

Will anything change now Biden is in power?

It seems unlikely that Biden will take as drastic actions as Trump did when it comes to China’s tech giants. While he will still be concerned about data security, Biden is more likely to try and resolve the problem through cooperation. We don’t expect any erratic and spontaneous measures. If he did seek to put restrictions on ByteDance, he would be expected to take into consideration the impact on American individuals and businesses, which he is perhaps more likely to do.

Call +44 (0)20 7802 2000 or email enquiries@cbbc.org for more information about how CBBC can help you find out if Douyin/TikTok could be the right platform to market your business in China.