TikTok faces increasing bans in both the US and EU.

TikTok has introduced several initiatives in an effort to appease regulators.
TikTok faces increasing bans in both the US and EU.

As the pressure mounts on TikTok, amid concerns about its vulnerability to the CCP and potential bans in the US and Europe, the company has rolled out new initiatives aimed at winning over policymakers in both regions, in hopes of avoiding further restrictions and billions in lost future revenue.

The concerted efforts highlight how serious the situation has been for the company, which, of course, is not facing restrictions in Canada and Australia as well. And, really, if one region shut it down, it seems to be increasingly likely that others may follow, which could probably be a virtual death blow for the app.

First off, in Europe – TikTok's European staff have launched a new effort to win over EU regulators by outlining a plan to ensure that European user data is only stored in its Ireland data center, and is not accessible by Chinese staff.

The program, called 'Project Clover', is being communicated to EU officials in the hopes of avoiding further action in the region.

TikTok has, meanwhile, launched a similar campaign in the US in what is called 'Project Texas', through which it's looking to highlight how US user data will similarly be cut off from outside interference.

TikTok has long been working on that strategy, which it says has cost over a billion dollars so far in development. Even still, that's not enough, said some officials, who with Sen. Josh Hawley noted this week that TikTok's parent company, ByteDance, whose employees can easily access U.S. user data-are likely to continue to be able to do so now, and going forward so long as the company continues under Chinese ownership.

Hawley is but one of several high-profile figures demanding a complete ban in the US, and it's not just Hawley. FBI Director Christopher Wray has also weighed in again this week on his objections to the app.

Here's Wray, as reported by Bloomberg:

"This is a tool that is ultimately within the control of the Chinese government and to me it screams out with national security concerns.

Wray has raised similar concerns before, as have other senior security experts, which added fuel to the momentum behind passing a new bill that would allow President Biden to sign a full ban on the app, if he desires.

That bill is now formally introduced, which means one step closer to being realized – and brings TikTok a step closer to an actual US ban.
And the squeeze is starting to bear down – this week, it also put a call out to some of its top creators asking them to show their support for the app by appearing in Washington to highlight its importance to US lawmakers.

According to The Information:

"The trip would include "standing side by side with creators and the TikTok team at the US Capital" to show TikTok's positive impact."

That’s an extreme step, and with US/China relations fraying, amid concerns around spy balloons, and China’s support of Russia’s actions in Ukraine, the stress on TikTok is clearly reaching critical levels.

And it does seem that we’re going to get a conclusion, in some form, sometime soon.

TikTok CEO Shou Zi Chew is due to testify before the House Energy and Commerce Committee this month, which is going to most likely become that inflection point that determines what happens next, possibly in the US as well as Europe.

If Chew's assurances satisfy him that US user data is safe, then maybe TikTok stays; if not - which on balance seems rather more likely-that does seem like a threat to TikTok.

Next will then either be a total ban or a rapid sell-off of the app, almost exactly what happened back in 2020 when former President Donald Trump sought to force TikTok into US ownership.
 
That may still be on the cards, which could eventually see a total split of the app's operations into US, European, and Chinese entities.

In essence, the fate of TikTok is in the hands of CCP, which seems no closer to improving foreign relations any time soon. And if they worsen, TikTok may quickly lose touch with hundreds of millions of its users.

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2024-11-29 14:13:01