ByteDance hoped the transfer would satisfy Washington's security concerns, but it appears it hasn't. Indeed, Reuters notes that TikTok finished migrating US user data to stateside Oracle servers last June. "The best way to address concerns about national security is with the transparent, US-based protection of US user data and systems, with robust third-party monitoring, vetting, and verification, which we are already implementing," Oberwetter said.
Instead, TikTok offers an alternative by pledging $1.5 billion to implement a system to protect US customers' personal information and platform content from Chinese government influence and data collection. "If protecting national security is the objective, divestment doesn't solve the problem: a change in ownership would not impose any new restrictions on data flows or access," said TikTok spokeswoman Brooke Oberwetter. The company claims that forcing the sale would not alleviate the Biden administration's perceived security risks. Employees another 20 percent through stock options. Its founders, Zhang Yiming, ByteDance Chief Executive Liang Rubo, and others, own 20 percent, including most of the voting shares. Divestment would mean that Beijing-based ByteDance would essentially have to sell TikTok to someone outside of China.Īccording to TikTok, worldwide investors own 60 percent of the company. On Wednesday, anonymous insiders told The Wall Street Journal that the Committee on Foreign Investment in the US, or Cfius (pronounced sif-ee-ous), made the demand recently after criticism that the administration was not taking the threat to national security seriously enough.
The Biden administration has had a contentious relationship with TikTok owner ByteDance for the last few years, having barred the app on government-owned devices over national security concerns. The Whitehouse has demanded that TikTok's Chinese owners divest themselves of the company, or it will ban the popular app in the US. Will ByteDance sell or risk losing 100 million US users?
TikTok has offered a $1.5bn security plan to protect user data from Chinese government influence, but the Biden administration demands a change in ownership. In a nutshell: The US government is pressuring ByteDance to sell TikTok over national security concerns.
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