TikTok, the wildly popular social media app known for its viral dance and lip sync clips, has been embraced by millions of students, celebrities and young adults across the United States. But the company’s ties to China could cripple its existence.
TikTok, which is owned by China-based ByteDance, has become the latest target in the Trump administration’s long-simmering security and economic battle with Beijing. It is now desperately trying to convince lawmakers and administration officials that its allegiance lies with the United States, not China.
The social media company, which one year ago had virtually no lobbying presence in the nation’s capital, has hired a small army of more than 35 lobbyists to work on its behalf, including one with deep ties to President Donald Trump.
Behind that buildup is a growing threat to one of TikTok’s most important markets. Secretary of State Mike Pompeo has threatened to ban Chinese apps like TikTok, which are downloaded to mobile phones, over concerns they could be used for surveillance by the Chinese government. Peter Navarro, the White House trade adviser, called TikTok’s new chief executive an “American puppet” during a Fox Business interview Sunday and said the administration would take “strong action” against the company and other Chinese social media apps.
A powerful U.S. panel has opened a national security review into ByteDance’s 2018 purchase of Musical.ly, an app that was merged to form TikTok. The Committee on Foreign Investment in the United States is examining whether the merged companies could give the Chinese government access to vast amounts of U.S. data, including videos useful for training facial recognition software. And the Trump administration is weighing action against Chinese social media services like TikTok under the International Emergency Economic Powers Act, which allows the president to regulate international commerce in response to unusual and extraordinary threats, people familiar with the deliberations said.
In the past three months, lobbyists working on behalf of TikTok have held at least 50 meetings with congressional staff and lawmakers, including those on top committees like commerce, judiciary and intelligence. Those meetings have included a slick presentation that includes an organizational chart showing TikTok does not operate in China and that most of its leadership reside in the United States and are American citizens. For instance, TikTok’s new chief executive, Kevin Mayer, a former executive of Disney, lives in Los Angeles, they said.
ByteDance denies it shares data with the Chinese government and is distancing itself from its roots in the communist nation. The company stressed TikTok was not available in China – it offers a similar app called Douyin there instead – and said user data was stored in Virginia, with a backup in Singapore.
“There’s a lot of misinformation about TikTok right now,” said Michael Beckerman, vice president and head of U.S. Public Policy. “TikTok is led by an American CEO, with hundreds of employees and key leaders across safety, security, product and public policy in the U.S.”
But some members of Congress still have suspicions. An aide to Sen. Marco Rubio, R-Fla., who requested the CFIUS review of TikTok, said ByteDance had provided conflicting information in a meeting with representatives of Rubio’s office about where its data was stored as well as insufficient information about how it controls and censors its content.
“It is no coincidence that every day more companies and organizations are asking employees to delete TikTok,” Rubio said in a statement, referring to moves by Wells Fargo and others to bar the app from company devices. “TikTok has yet to provide a real explanation to Americans about how they protect their data and how much of it could be made available to the Chinese Communist Party.”
The United States provides a crucial audience for TikTok. American influencers have global followings, and the app has become a center of conversation about politics, the pandemic and racial inequality. TikTok users claimed credit for reserving thousands of seats for Trump’s campaign rally in Tulsa, Oklahoma, last month – and then not showing up.
But it remains a high bar for ByteDance to convince the U.S. government that it is not susceptible to the directives of the Chinese government. Trump and his top advisers have increasingly focused on Chinese technology companies, including Huawei and ZTE, saying those firms threaten national security by providing a conduit for the Chinese government to infiltrate U.S. technology. The United States has already barred dozens of high-tech Chinese companies – including those specializing in supercomputers, artificial intelligence and facial recognition – from gaining access to U.S. technology products out of national security concerns.
“What the American people have to understand is, all the data that goes into those mobile apps that kids have so much fun with and seem so convenient, it goes right to servers in China, right to the Chinese military, the Chinese Communist Party and the agencies that want to steal our intellectual property,” Navarro said over the weekend.
The issue of whether TikTok should be curbed in the United States has taken on new urgency, in part because of India’s decision in late June to ban it and nearly 60 other Chinese apps, a Trump administration official said. TikTok has been downloaded 2 billion times, with its biggest markets in India, the United States and Brazil, according to SensorTower.
In December, the Pentagon ordered military personnel to delete the TikTok app from their phones, and some administration officials have argued that the United States should retroactively block ByteDance’s acquisition of Musical.ly, which could force the company to divest its U.S. assets or at least make changes to the way it moves and stores data worldwide.
The State Department is considering expanding its so-called clean networks program to include apps as it tries to steer foreign governments away from unsecure Chinese telecommunications firms in the name of protecting Americans’ private information, according to officials familiar with the internal discussions.
TikTok would be considered among those apps, although officials said the State Department has not yet designated companies to be included in the expansion.
“Whether it’s TikTok or any of the other Chinese communications platforms, apps, infrastructure, this administration has taken seriously the requirement to protect the American people from having their information end up in the hands of the Chinese Communist Party,” Pompeo said Wednesday in an interview with The Hill newspaper in Washington.
He said he had heard from parents eager to see TikTok banned: “That’s for the parents to decide their kids’ usage on their cellphones. It’s our task to make sure that their children’s information doesn’t end up in the hands of the Chinese Communist Party.”
Officials have also been considering potential national security risks from other Chinese internet and social media services, including Tencent’s WeChat, which had more than 1 billion active monthly users worldwide in the first quarter of 2020.
“These companies cannot claim that they don’t follow the orders of the party; that’s just not credible,” said Derek Scissors, a resident scholar at the American Enterprise Institute who tracks Chinese investment worldwide. “Chinese firms don’t have a choice.”
TikTok and the venture funds it counts as its major investors have tried to reassure the Trump administration – including Treasury Secretary Steven Mnuchin, who is in charge of the national security review panel – that it has walled off its China operations from other global activities, people familiar with the conversations said. The firm recently pulled its operations out of Hong Kong after the city imposed new national security laws that would bring Chinese-style censorship to residents. Officials have also raised potential changes to its corporate structure that could include moving its global headquarters during discussions with U.S. officials, these people said.
The company has added well-connected lobbyists, including Beckerman, the former president of the Internet Association and a longtime Republican congressional aide, and David Urban, who ran Trump’s campaign in Pennsylvania and has been described by the president as “one of my good friends.” He is also a West Point classmate of Pompeo and Mark Esper, the defense secretary.
Beckerman has hired 15 lobbyists and communications staff for ByteDance, including aides to Paul Ryan, the former Wisconsin lawmaker and speaker of the House, and Rep. Jim Clyburn of South Carolina, the Democratic whip.
ByteDance has also tapped its prominent investors for help. General Atlantic, whose chief executive, William Ford, sits on ByteDance’s board, has been advising TikTok on lobbying strategy; and SoftBank, which invested in ByteDance in 2018, has suggested new Washington hires in the past, said two people familiar with the matter.
For the first three months of 2020, ByteDance spent $300,000 on lobbying, double the amount it spent in the previous quarter and the equivalent of its two quarters of lobbying in 2019. TikTok’s lobbying force is not as large as those of other tech giants like Amazon, Facebook and Google, but the company has deployed a defensive army with astonishing speed.
Efforts to sway lawmakers have not always gone smoothly. The company scheduled meetings in December between the then-head of TikTok, Alex Zhu, and lawmakers critical of the company. It then canceled the meetings, which irritated lawmakers, who promptly shared news of the canceled meetings on Twitter. (TikTok told reporters at the time that the meetings were postponed until after the holidays.)
In meetings with lawmakers, lobbyists insist that the app is mainly for entertainment and is not the type of content that is normally targeted for government surveillance, according to two people with knowledge of TikTok’s lobbying activities. They point out that the most popular clips are by young influencers like 16-year-old dancer Charli D’Amelio of Connecticut, who has 70 million followers.
The company has also highlighted its American investors, like the Chinese arm of the venture capital firm Sequoia and the private equity firms KKR and General Atlantic, said one person familiar with the matter.
Beckerman’s staff sends a regular email newsletter to Capitol Hill with uplifting stories about TikTok. They have highlighted fun videos about the Netflix series “Tiger King” and clips related to COVID-19 prevention.
But in recent days, they have taken a more defensive tone. In the newsletter sent Friday, Beckerman highlighted TikTok’s decision to leave Hong Kong.
“We put action behind words,” he said.
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