TikTok could grab of Chinese ByteDance in order to avoid ban in US
TikTok could separate itself from Chinese company ByteDance to use as an unbiased American firm in order to avoid being banned by the government.
TikTok has 40 million users in america and after recently being banned in another large market, India, after border clashes between troops of Delhi and Beijing, the short-video sharing social media company has a hard choice to make.
White House financial advisor Larry Kudlow said severing the umbilical cord with its parent company will be the better option for TikTok when compared to a ban on the iphone app threatened by Secretary of State Mike Pompeo, Reuters reported.
“We haven’t made final decisions but...I think TikTok will grab of the holding company which is China-run and operate as an independent American company,” Kudlow was quoted as saying by Reuters.
It really is unclear how this change would be made, the way the ownership would change and whether US companies had proposed to get out the US businesses of the app.
Security concerns will be the reason ascribed to the ban by India and the proposed ban in america, as Chinese companies have already been accused of sharing user data with the Chinese Communist Party which runs the government in Beijing. By Chinese law, any digital company which has its server in China are to permit scrutiny of its contents by authorities there. This makes the info of users far away accessible to China, which takes its national security risk, the US argues.
The US has been relentlessly pressing its allies to avoid Chinese telecommunications and technology companies and recently got Britain to ban Huawei from all its networks. The US had already restricted Huawei from major American telecom networks and is even set to impose sanctions on Huawei staff.
In this context, and with america pointing towards human rights abuses by the Chinese government allegedly using technology and social media companies to spy on dissidents, TikTok had pulled out of Hong Kong recently after China introduced its national security law on the island to tighten its hang on the former British colony. The move was designed to distance TikTok from the Chinese administration.
Similarly, a breaking of ties with ByteDance will be a strategic proceed to continue TikTok’s business in america. However, TikTok has not confirmed such move yet. When asked about Kudlow’s remarks, a TikTok spokesman was quoted as saying by Reuters that the company would not “build relationships speculation available in the market,” and described a statement the other day noting that ByteDance was “evaluating changes to the corporate structure of its TikTok business” and was fully committed to protecting users’ privacy and security.
