Before a panel of skeptical and hostile US representatives, TikTok CEO Shou Zi Chew tried to make the case for why the popular app doesn’t pose a security risk to the country — and why a government ban on the app would be the wrong thing to do. action.
A U.S. ban on the app would hurt the country’s economy, reduce competition and “silence the voices of more than 150 million Americans,” Chew said in testimony before the House Energy and Commerce Committee. The hearing, titled “TikTok: How Congress Can Protect America’s Data Privacy and Protect Children from Harm Online,” was held Thursday morning in Washington, DC.
More from Variety
The Biden administration recently demanded that ByteDance divest its ownership stake in TikTok or possibly be banned in the US over national security concerns given TikTok’s Chinese ownership. Under pending congressional legislation, which has bipartisan support, President Biden would have the authority to ban TikTok under the International Emergency Economic Powers Act.
“ByteDance is not owned or controlled by the Chinese government,” Chew said during Thursday’s hearing. He declined to provide revenue estimates or financials for TikTok, saying ByteDance is a private company.
In his prepared remarks, Chew argued that there is an alternative to a complete ban on TikTok to address concerns about Chinese influence on the app. “Let me say this unequivocally: ByteDance is not an agent of China or any other country,” Chew said in his filed testimony. He said there is a “mistaken belief that TikTok’s corporate structure is beholden to the Chinese government or that it shares information about U.S. users with the Chinese government. This is emphatically not true.”
Chew told committee members: “The bottom line is: [TikTok’s] US data [is] stored on US soil, by a US company under the supervision of US personnel.”
Members of the House committee – on both sides of the aisle – did not believe his claims. “Your platform should be banned,” committee chairwoman Cathy McMorris Rodgers (R-Wash.) said at the start of the hearing, claiming that the Chinese Communist Party can use TikTok to “spy” on Americans and gain access to their Private data. She also claimed that TikTok had caused “harm.”[s] our innocent children” and “promotes death and despair in children.” Rep. Frank Pallone (D-N.J.), a ranking member of the committee, raised the specter that the Chinese government would use TikTok to spread disinformation and harmful content.
“We have no confidence that TikTok will ever embrace American values – values of freedom, human rights and innovation,” Rodgers said. “TikTok has repeatedly chosen a path toward more control, more surveillance and more manipulation.”
When asked by Rodgers whether Chew could guarantee that ByteDance and TikTok employees would not be able to engage in “surveillance” of US users, the CEO said he disagreed with the characterization that TikTok is spying on users has allowed and said: ‘We will not be influenced by any government.”
Rodgers was referring to the company’s revelation last year that ByteDance employees were using TikTok to track U.S. citizens. In December 2022, ByteDance said four of its employees violated company policy by improperly accessing data on US TikTok users, including two journalists, in an effort to track down the source of information leaks. ByteDance said it has laid off all four employees, two in the US and two in China. The incident is now reportedly under investigation by the Department of Justice and the FBI.
In his submitted testimony, Chew said TikTok made a company-wide disclosure when executives learned late last year that its employees had accessed TikTok user data in “a failed and misguided attempt to track down the source of a leak of confidential TikTok information.” ” He added: “I condemn this misconduct in the strongest possible terms.”
According to Chew, TikTok was incorporated in the US and subject to the laws of the country. He repeated the claim that TikTok has never shared or received a request to share U.S. user data with the Chinese government (and that TikTok would not honor such a request if one were ever made). About 60% of ByteDance is owned by “global institutional investors” including Blackrock, General Atlantic and Sequoia, with 20% owned by the company’s Chinese founders and 20% owned by other employees. ByteDance, Chew claimed, “is not owned or controlled by any government or state entity.”
Chew reiterated TikTok’s position that forcing ByteDance to divest its ownership stake in the app would not change the way TikTok operates. “A change of ownership would not impose new restrictions on data flows or access,” he said in his testimony. “All global businesses face common challenges that must be addressed through safeguards and transparency.”
Ahead of the hearing, a spokesperson for China’s Commerce Ministry said Thursday that the country would “strongly oppose” any forced sale of TikTok because it would “destroy the confidence of investors from various countries, including China, to invest in the United States.” would seriously undermine investment. ByteDance’s sale of its TikTok property would represent a technology export and be subject to China’s approval, the Commerce Department said.
Earlier this week, in a call for US users to contact elected officials to express their support for the app, TikTok announced that it has more than 150 million monthly active users in the US. In addition, it said it has nearly 7,000 employees. in the US and hosts nearly 5 million US businesses on the platform. Chew posted a message on TikTok warning that a ban would “take TikTok away from all 150 million of you.”
“TikTok has empowered millions of Americans to express their voices in their own authentic ways and provided a global stage for their creativity in a way that cannot be replicated on any other platform or in any other medium,” Chew said in the written testimony.
According to Chew, while American users represent 10% of TikTok’s global user base, they account for 25% of the app’s total views worldwide. “While some people may still think of TikTok as a dance app for teens, the reality is that our platform and community have become so much more,” the CEO said.
Chew said TikTok is committed to “transparency” and outlined four areas it is focusing on: improving user safety, especially for teens; protecting US users’ data from unauthorized foreign access; prevent the app from being “manipulated by any government”; and providing access to independent third-party monitors. TikTok recently opened its first physical Transparency and Accountability Center in Los Angeles, and another center is planned for Washington DC, he said.
In an effort to address the Biden administration’s concerns, TikTok — under what it has dubbed Project Texas — says it has invested $1.5 billion over the past two years to create a U.S.-based data security division and that it has an agreement with Oracle to store user app data in the country.
Its subsidiary, TikTok US Data Security Inc. (USDS), has nearly 1,500 full-time employees and “we expect that number to grow significantly in the coming year,” Chew said. Currently, “100% of US user traffic is routed to the Oracle and USDS controlled infrastructure in the United States,” and the subsidiary hosts TikTok’s recommendation system for US users that populates the For You feed in the Oracle Cloud Infrastructure, Chew said . Additionally, Oracle “has already begun inspecting TikTok’s source code and is gaining unprecedented access to its algorithms and data models. No other social media company or entertainment platform like TikTok offers this level of access and transparency.”
According to Chew, TikTok this month began deleting historically protected US user data stored on non-Oracle servers, which the company expects to complete later this year. “When that process is complete, all protected US data will be under the protection of US law and under the control of the US-led security team. Under this structure, there is no way for the Chinese government to access or enforce access to it,” Chew said. He noted that there are “some limited exceptions” where non-US employees can access protected data, for example for legal and compliance reasons, but “such access must be expressly authorized by USDS under a robust data access protocol.” No employee of China-based Beijing Douyin Information Service has access to databases containing protected U.S. user data, he added.
In the future, TikTok’s USDS employees would report to an independent board of directors that would be “approved by and owe a fiduciary duty” to the U.S. government, Chew said.
Chew also addressed TikTok’s steps to protect children’s safety. He noted that in the US, TikTok offers a distinct experience for users under 13, with additional safeguards and privacy protections and without ads. TikTok announced earlier this month that all accounts used by people under the age of 18 will default to a daily screen time limit of 60 minutes. “As a father of two, these issues are personal to me,” Chew said. “Today’s youth are growing up in a digital media world and TikTok wants to be part of the conversation about creating more robust protections.”
Chew, a former investment banker at Goldman Sachs, was named CEO of TikTok in April 2021. He is a graduate of the University College of London and Harvard Business School and lives in Singapore.
VIP+ analysis: TikTok hearing only helps Meta’s Zuckerberg
Best of variety
Sign up for the Variété newsletter. For the latest news, follow us on Facebook, Twitter and Instagram.