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TikTok CEO testifying before Congress Thursday

by Index Investing News
March 23, 2023
in World
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Shou Zi Chew’s testimony comes at a crucial time for the company, which has acquired 150 million American users but is under increasing pressure from U.S. officials.

WASHINGTON — The CEO of TikTok will make a high-profile appearance Thursday before a U.S. Congressional committee, where he’ll face a grilling on data security and user safety while he makes his own case for why the hugely popular video-sharing app shouldn’t be banned.

Shou Zi Chew’s testimony comes at a crucial time for the company, which has acquired 150 million American users but is under increasing pressure from U.S. officials. TikTok and its parent company ByteDance have been swept up in a wider geopolitical battle between Beijing and Washington over trade and technology.

Chew, a 40-year-old Singapore native, is making a rare public appearance to counter the volley of accusations that TikTok has been facing. On Wednesday, the company sent dozens of popular TikTokers to Capitol Hill to lobby lawmakers to preserve the platform. It has also been putting up ads all over Washington that tout promises of securing users data and privacy and creating a safe platform for its young users.

Chew plans to tell the U.S. House Committee on Energy and Commerce that TikTok prioritizes the safety of its young users and deny allegations that the app is a national security risk, according to his prepared remarks released ahead of the hearing.

TikTok has been dogged by claims that its Chinese ownership means user data could end up in the hands of the Chinese government or that it could be used to promote narratives favorable to the country’s Communist leaders.

“We understand the popularity of Tiktok, we get that,” said White House press secretary Karine Jean-Pierre at a press conference Wednesday afternoon. “But the President’s job is to make sure again that the Americans, national security is protected as well. ”

For its part, TikTok has been trying to distance itself from its Chinese origins, saying that 60% percent of its parent company ByteDance is owned by global institutional investors such as Carlyle Group. ByteDance was founded by Chinese entrepreneurs in Beijing in 2012.

“Let me state this unequivocally: ByteDance is not an agent of China or any other country,” Chew said.

A U.S. ban on an app would be unprecedented and it’s unclear how the government would go about enforcing it.

Experts says officials could try to force Apple and Google to remove TikTok from their app stores, preventing new users from downloading it as well as preventing existing users from updating it, ultimately rendering it useless.

The U.S. could also block access to TikTok’s infrastructure and data, seize its domain names or force internet service providers like Comcast and Verizon to filter TikTok data traffic, said Ahmed Ghappour, a criminal law and computer security expert who teachers at Boston University School of Law.

But a tech savvy user could still get around restrictions by using a virtual private network to make it appear the user is in another country where it’s not blocked, he said.

To avoid a ban, TikTok has been trying to sell officials on a $1.5 billion plan called Project Texas, which routes all U.S. user data to domestic servers owned and maintained by software giant Oracle. Under the project, access to U.S. data is managed by U.S. employees through a separate entity called TikTok U.S. Data Security, which employs 1,500 people, is run independently of ByteDance and would be monitored by outside observers.

As of October, all new U.S. user data was being stored inside the country. The company started deleting all historic U.S. user data from non-Oracle servers this month, in a process expected to be completed later this year, Chew said.

A number of Western countries including Denmark, Canada, and New Zealand, along with the European Union, have already banned TikTok from devices issued to government employees, citing cybersecurity concerns.

In the U.S., the federal government, Congress, the armed forces and more than half of states have banned the app from official devices.

David Kennedy, a former government intelligence officer who runs the cybersecurity company TrustedSec, agrees with restricting TikTok access on government-issued phones because they might contain sensitive military information or other confidential material. A nationwide ban, however, might be too extreme, he said. He also wondered where it might lead.

“We have Tesla in China, we have Microsoft in China, we have Apple in China. Are they going to start banning us now?” Kennedy said. “It could escalate very quickly.”

Chan reported from London.



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