TIkTok: It’s time for Biden to make a decision on his digital policy with China

While on the campaign trail, now US president elect Joe Biden, made it clear to voters that he viewed Tik Tok as “a matter of genuine concern.” The statement came amidst a growing environment of hostility within the American government against the application. At the helm of the hostility was (now former) president Donald Trump’s passing of an executive order banning Tik Tok in the country and his attempts at forcing its parent company ByteDance to restructure the app under American ownership. Now, as the presidency passes hands, it is worth examining how the government got here and just how concerned the Biden administration should be with Tik Tok and how their strategy with the app could set the tone for digital relations with China going forward 

The Road so far: The ban and forced sale of TikTok

America’s motivation to ban and sell the application can be explained by two contrasting factors: the cybersecurity risks that TikTok poses, and the country’s currently ongoing trade war with China. On the security side TikTok has faced immense scrutiny from governments around the world as to the amount of data that the application collects from its users as well as the potential links between Bytedance and the Chinese government. Furthermore there is a belief that due to the Chinese legislation that compels companies to assist the state on matters of national intelligence, there is little TikTok could do should the Chinese state decide to use it as an instrument of data collection. On the side of trade, the TikTok ban represents one of the more landmark blows dealt by the Trump government in its trade war with China. The US, since the start of his presidency has levied exclusive tariffs on specific Chinese commodities totalling to more than $550 billion. China has in response levied its own tariffs on certain American goods, with a total value of those estimated at $185 billion. Beyond these tariffs, the move to ban TikTok extends the trade war by creating clear hurdles for Chinese corporations to exist within the US market and firmly extended Trump’s protectionist trade policies into the digital sphere.  

As such, on 6th August 2020, Trump released an executive order banning TikTok (as well as Chinese messaging and social media app Wechat). The ban has, however, since been indefinitely suspended as part of ongoing litigation on the matter at the federal level.

Shortly after the ban, came the attempts at forcing through the sale. While the deal has generally been referred to as ‘the TikTok sale’, it is not actually an outright purchase of the social media platform by an American company (Microsoft attempted such a purchase but was rejected by Byte Dance). Rather, the deal would see the establishment of a new US based subsidiary called TikTok global that would be partly owned (20%) by Oracle and Walmart, with Oracle becoming a trusted technology provider in order to ensure that US user’s data remains within the state. The agreement stipulates that the board of this new entity would have 4 out of 5 of the seats populated by US citizens, and that the company would go public as well. The current agreement would still see Bytedance retain ownership of the algorithms used by TikTok, which is in line with restrictions from the Chinese government preventing the sale of the algorithm to a foriegn owner without a state granted license.

How should the Biden administration handle this situation? 

Dealing with the TikTok question must be one of the Biden administration’s top most priorities. The most obvious question they face is whether or not to reverse the ban and to continue to push through the sale between Bytedance and Oracle. 

The case for enforcing the ban until the sale to American owners seems one that is straightforward enough. The cybersecurity concerns surrounding Bytedance’s proximity to the Chinese state and the influence of Chinese legislation are reasonable concerns. And any data gained from the application in the hands of a hostile state could be potentially harmful. This threat could be potentially reduced based on the role played by Oracle as a trusted technology partner. However with details of what exactly constitutes the functions of a ‘trusted technology partner’ it is impossible to say this with any great certainty. Simultaneously, there is a slight sense of irony in a Chinese based digital company protesting against another country’s protectionist stance to the internet.   

Nonetheless these benefits are in many ways greatly over exaggerated, and in many ways allowing TikTok to return without requiring a sale could prove more beneficial in the long term. Not only would the app’s return be welcomed by its immense audience (estimated 100 million US users), it would also be a clear demonstration of America’s commitment to a less fragmented internet and more open digital economy. Furthermore, revoking the ban would also allow for the opportunity to reassess and reformulate the US’s economic and political strategy with regards to Chinese technology. 

On the economic side, a retraction of the ban could signal the beginning of the end of the US-China trade war. Chinese investors are sure to see the shift from a radical republican president to a centrist democrat one as the perfect opportunity to increase foreign investment, which had been steadily declining recently. Such investment could prove significantly more substantial to the United States in a post covid-19 world as opposed to even in 2019. It is not unimaginable that Biden would look to maximise this opportunity to boost the economy. 

On the political side, the government has to evaluate the success of sanctions levied against Chinese technology and whether that approach of blanket banning will translate effectively to the digital sphere. Not only has the US’s sanctions against certain chinese technologies proved unsuccessful, tools such as VPNs that can negate a ban make this strategy even less effective in the digital space. 

The largest hurdle to revoking the ban would be the genuine cybersecurity concerns with a Chinese corporation having access American citizens’ data. However, dealing with these concerns through a simple ban of the application would only solve this one instance of excessive surveillance and data collection by a foreign app. Rather any solution must look to fix the issue at its root - that being the need for a more cohesive, detailed and overarching national data protection and cybersecurity policy. Such a policy could place clear limitations on data collection, stipulate data localisation policies for sensitive information and outline numerous other means of reducing the threat involved with allowing applications from states such as China to operate in the US. 

 Ultimately, Biden will be confronted with the reality of this situation the moment he enters office. The decision he makes on TikTok would set the tone for his term and for his government’s relationship with China. Whatever he decides to do, he needs to do it as soon as possible. The clock is ticking.