Despite this complication, a tentative deal was reached between Oracle and ByteDance, but the sale was put on hold in February 2021 after Trump left office. Reuters earlier reported that TikTok and Oracle are nearing a deal for the US tech company to store all American user data, and that access to that data would be limited to a specific team. The Biden administration is currently in the process of developing new regulations for apps that could enable foreign governments to obtain US citizen data.
Senator Marsha Blackburn, however, said she will be concerned as long as “product developers and key decision makers are based out of the PRC. TikTok is saying what they think will help them escape scrutiny from lawmakers, but that won’t happen as long as they remain the arm of the CCP.”
Fears that China could use TikTok to access US citizens’ data or shape US civic discourse are not unfounded. In 2019, the Guardian reported that TikTok had censored videos on topics of Chinese political importance. TikTok had nearly 40 million US users at the time. In February 2021, the company agreed to pay $92 million to settle a class action lawsuit alleging it had transferred US user data to servers in China.
Since the CFIUS investigation began, ByteDance has separated teams working on TikTok from those working on Douyin, the app’s mainland China equivalent, and considered creating a new “management board” and a US headquarters. In November 2021, TikTok’s CEO Shou Zi Chew stepped down from his role as ByteDance’s CFO (a job he had held while also running TikTok). But to date, no action by the company has changed the core relationship between the companies: ByteDance still owns and controls TikTok today.
Interviews with 19 current and former TikTok employees show that ByteDance’s control over TikTok is not merely structural. Employee accounts portray the companies as sometimes so closely entwined that it is unclear where TikTok stops and ByteDance begins. Some workers described instances where senior leadership decisions were made by unknown actors in Beijing. Others said their managers handed down key product decisions after they had “talked to Beijing.” One employee described hesitation after being asked to enter sensitive information into a .cn domain. Two others said they’d occasionally been tasked with work on other ByteDance products, though their employment agreement was with TikTok. Others noted the opacity of the company’s org chart: 10 employees who spoke to BuzzFeed News did not know the identities of the people that their managers (or their managers’ managers) reported to.
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TikTok and ByteDance declined to comment on TikTok employees working on other ByteDance products and receiving direction from ByteDance employees. Instead, Shanahan said in a statement: “TikTok’s CEO has full autonomy for all decisions about TikTok’s operations.”
ByteDance’s access to internal TikTok communications raises the possibility that governments could require ByteDance to turn over sensitive company communications, like those between TikTok and other governments, or internal investigations into disinformation campaigns.
According to Jennifer Banks, a spokesperson for ByteDance, the Chinese government has never requested TikTok employee communications from Feishu or Lark. (She did not answer a follow-up question about whether other governments have done so and if ByteDance has complied with such requests.) But James Lewis, director of the Strategic Technologies Program at the Center for Strategic and International Studies, told BuzzFeed News that it would not be able to prevent such a request in the future. He said: “There are no legal protections for a company in China. If the party leadership decides they want everyone to dye themselves blue with woad, then they have to do it.”
“There are no legal protections for a company in China. If the party leadership decides they want everyone to dye themselves blue with woad, then they have to do it.”
So far, Project Texas appears to be primarily an exercise in geography, one that seems well-positioned to address concerns about the Chinese government accessing Americans’ personal information. But it does not address other ways that China could weaponize the platform, like tweaking TikTok algorithms to increase exposure to divisive content, or adjusting the platform to seed or encourage disinformation campaigns.
Adam Segal, director of the Digital and Cyberspace Policy program at the Council on Foreign Relations, told BuzzFeed News that the Chinese government’s influence on TikTok’s algorithms is a more pressing concern than data exfiltration. “I’ve never seen a particularly good argument about what the Chinese could get from TikTok data that they can’t get from hundreds of other sources,” he said. But he did point to examples of the Chinese Communist Party using technology to warp digital discourse, including TikTok’s previous censorship of speech harmful to China’s “national honor,” and a 2020 attempt by a China-based Zoom employee to disrupt video meetings commemorating the Tiananmen Square massacre.
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TikTok vehemently denies accusations that it censors speech critical of China today. And members of TikTok’s Trust & Safety team, which makes and enforces content policies for the company, portrayed it as comparatively well insulated from ByteDance influence. Employees described Trust & Safety workers as having less frequent contact with Beijing, and clearer lines of reporting, than other employees that BuzzFeed News spoke to — and described TikTok’s Trust & Safety practices as similar to those adopted by US-based tech giants. Nonetheless, the question of reporting structure looms large: Like other senior TikTok officials, its head of Trust & Safety reports to TikTok’s CEO, who reports to ByteDance as TikTok’s corporate owner. And as long as the buck stops with ByteDance, “there is a ceiling” to how much TikTok can distance itself from the Chinese government, Lewis said.
At the same hearing, Sen. Marsha Blackburn asked Beckerman whether ByteDance employees had access to TikTok’s algorithm. Beckerman, not directly answering the question, said that US user data is kept in the US. Blackburn also asked whether there are programmers, product developers, and data teams in China working on TikTok. Beckerman confirmed that there are.
Lawmakers beyond the US have also raised concerns about TikTok’s relationship with China. In June 2020, the Indian government banned TikTok, WeChat, and more than 50 other Chinese apps after a clash on the India–China border that killed 20 Indian soldiers. India’s regulatory body, the Ministry of Electronics and Information Technology, alleged that the apps were “stealing and surreptitiously transmitting” Indian user data to data centers outside of India. In August 2020, intelligence agencies in Australia began investigating whether TikTok poses a security threat to the country. In September 2021, Ireland’s Data Protection Commission opened an investigation into how TikTok transfers user data to countries outside the EU.
The similarities between different countries’ regulatory concerns about TikTok and China emphasize the potential importance of Project Texas. If it succeeds in the US, the project may serve as a roadmap for TikTok in other jurisdictions (perhaps even in India, where it has been banned). It may also serve as a model for other large companies, like Amazon, Facebook, and Google, which face similar concerns from overseas regulators about collecting their citizens’ personal information.
Graham Webster, editor-in-chief of the Stanford–New America DigiChina Project at the Stanford University Cyber Policy Center, sees TikTok as “a guinea pig” for lawmakers’ inherent skepticism about foreign companies collecting their citizens’ data. Still, Webster says he’s optimistic, because ByteDance has a heavy incentive to get regulators fully comfortable with TikTok.
“This is a company that is looking for a way for this to actually work,” he said. “They’re going to keep trying until there’s an obvious defeat, because the amount of money on the table is enormous.”