Washington Moves Highlight How Quickly Concept of Internet Decoupling is Becoming Reality (File)
By taking on TikTok, the United States is expanding its fight against Beijing by using Chinese-style restrictions on tech companies in a move that could potentially have huge ramifications for the world‘s largest economies.
The Trump administration’s threat to ban the viral teen phenomenon from ByteDance Ltd. and other Chinese-owned applications could significantly hamper their access to global user data, which is an extremely valuable resource in a modern internet economy. Any US move, which Secretary of State Michael Pompeo has said will come “shortly,” will likely be followed by a similar campaign of pressure that has prompted some allies to ban Huawei Technologies Co. from 5G networks.
Even though TikTok’s U.S. operations are taken over by Microsoft Corp., the episode is the culmination of an Internet fork that began when China closed its own online sphere years ago, creating a universe alternative where Tencent Holdings Ltd. and Alibaba Group Holding Ltd. replaced Facebook Inc. and Amazon.com Inc.
It also divides many in the industry: some denounce the betrayal of values like free speech and capitalism, while others advocate doing whatever it takes to subdue a geopolitical rival and its pivotal tech industry. .
“This sets a dangerous precedent for the United States,” said Samm Sacks, a researcher on cybersecurity policy and the Chinese digital economy at the New America think tank. “We are taking the path of techno-nationalism”.
Washington’s actions underscore how quickly the concept of Internet decoupling is becoming a reality even as the world is still understanding its consequences. India has led the way by banning dozens of Chinese mobile apps, including Tencent’s TikTok and WeChat, while Australia and Japan are reportedly considering similar options.
The problem is who controls the data – everything from private details like locations and emails to sophisticated mined information like personal profiles and online behavior.
Like India, Washington is concerned that TikTok could funnel this treasure to Beijing, potentially compromising national security by creating databases on its citizens.
Worryingly for Beijing, it’s unclear where the United States would draw the line given how critical data is to businesses these days. While Washington’s restrictions on Huawei may have national security reasons, the argument for banning TikTok is “very weak,” according to Yik Chan Chin, who studies global media and communications policy in the United States. ‘Xi’an Jiaotong-Liverpool University in Suzhou. , a city near Shanghai.
“It’s not a reasonable argument – it’s like a blanket ban on Chinese companies,” she said. “How can Chinese companies do business in America?”
Be careful what you wish for
President Xi Jinping may be responsible himself. China has long championed cyber sovereignty, excluding services like Twitter, forcing foreign companies to find local partners and distributors in areas ranging from mobile games to cloud services, or reducing investment in areas such as online banking. . Microsoft Corp.’s Bing and LinkedIn, both of which censor content in China, remain the only major search engine and social network licensed to operate in China.
“We must respect each country’s choice of its Internet development path and business model, Internet public policy and the right to participate in the management of international cyberspace,” Xi told attendees at a meeting. high-profile internet conference in 2015. “There should be no cyber-hegemony, no interference in the internal affairs of others, no cyber-activities engaging, supporting or inciting to harm the national security of other countries . “
Now it’s China that wants the world to embrace its businesses and avoid overly broad interpretations of national security. Chinese Foreign Ministry spokesman Wang Wenbin said on Monday that the Trump administration “has extended the concept of national security without any evidence and solely on the basis of the presumption of guilt,” and called for ” create an open, fair, just and non-discriminatory environment for businesses in all countries. “
China’s past statements about cyber-sovereignty reflected its weakness at the time, and that view has evolved considerably since then, according to Zhao Ruiqi, deputy director of the School of Marxism at the University of Communication. from China to Beijing.
“Divide the Internet”
“Trump’s decision threatens to divide the internet, and it’s something the world should avoid,” Zhao said. “Countries should sit down and discuss the limits of national security when it comes to Internet governance.”
While some of Trump’s actions are seen to be motivated by re-election considerations, others say attacking TikTok has a deeper meaning. Already the world‘s most valuable startup with a potential price tag of $ 140 billion, ByteDance and its best-known product embody the dynamic spirit of a generation of consumer tech companies that could follow Alibaba and Tencent.
Hooking hundreds of millions of young addicts from New Delhi to Denver, founder Zhang Yiming showed a cohort of entrepreneurs how a Chinese startup can make a name for itself and one day stand alongside America’s biggest companies. Today, it serves some 1.5 billion monthly active users across a family of apps ranging from social media to games and education.
“TikTok symbolizes the ability of Chinese technology companies in algorithms, artificial intelligence, and the ability to go viral and make profits in a short period of time,” said Wang Sixin, professor at China University of Communication .
Now, the US restrictions would force a contingent of rising stars in fields ranging from gaming to live streaming and media to reassess plans for global expansion as they begin to gain traction overseas. While TikTok is the world‘s first successful Chinese-made internet service, there are a host of others that follow closely behind.
Among the most downloaded Chinese apps over the past 12 months in the United States are the Joyy Inc. Bigo and Likee platforms and Alibaba’s AliExpress shopping app, according to Sensor Tower. Like TikTok rival Likee, who also points out that it operates from outside of China, this year the United States has made the United States a top priority for its global expansion, with plans to inject more money and people in the area.
Launched in May, short video company Kuaishou’s Zynn has at times exceeded app downloads in the United States. And WeChat – used by more than a billion people around the world – is popular among the Chinese diaspora and American leaders with connections in the world‘s second largest economy.
If the administration decides that data is the key determinant, then even some of the world‘s most popular games can be trapped. Call of Duty: Mobile by Tencent, co-created by Activision Blizzard Inc., PUBG Mobile and Clash Royale from its subsidiary Supercell are all popular with Americans.
What Bloomberg Intelligence Says:
Growing global threats to ban Chinese mobile apps, out of security concerns and as retaliation for geopolitical tensions, could seriously hamper the overseas growth of Chinese internet companies. Joyy, Trip.com, Tencent, Alibaba and NetEase could face the greatest risks given their global ambitions and the relatively high usage of their services outside of China.
— Vey Sern-Ling and Tiffany Tam, analysts
Like other Chinese entrepreneurs, Zhang now must figure out how to keep up with ByteDance’s rapid growth rate while being largely confined to his own home market. Although ByteDance’s first success was an information app called Toutiao, it was TikTok that attracted hundreds of millions of users across the world. With 165 million installs, the United States is the second largest app market after India, as well as its most lucrative in terms of user spending, according to Sensor Tower estimates.
It’s a scathing retirement for a company that has tried to provide a haven for the highest paid artificial intelligence engineers. Zhang has fought to remain independent of the country’s tech triumvirate of Baidu Inc., Alibaba and Tencent, making it a rarity in the industry.
Now Zhang can find himself on the wrong side of nationalism in the United States and China. With hashtags on the US episode of TikTok on China’s largest microblogging platform, Weibo, Zhang withheld all of his posts from the public after users flooded his account with comments criticizing his decision to sell.
“Zhang Yiming knelt down quickly,” wrote a blogger. “Our country has not even had the chance to help him.”
(Except for the title, this story was not edited by GalacticGaming staff and is posted from a syndicated feed.)
