As Delta Bans TikTok, Experts Warn About Beijing’s Data Grab

Data is key to Beijing's struggle with the West

(Edgar Su/Reuters)

Delta Airlines has banned TikTok. Delta employees had until Friday afternoon to remove the app from phones, computers, and other smart devices that connect to company systems.

The airline is just the latest entity to restrict TikTok’s use in the United States. Concerns about the Chinese app’s use of American data are finally starting to have a widespread impact.

That can’t happen soon enough, say experts.

Beijing sees the scramble for global data as an important part of its strategic competition with the West, forcing Chinese high-tech companies to share data and serve its goal.

According to a recent Hoover study entitled “China’s Grand Strategy for Global Data Dominance,” Chinese leader Xi Jinping sees data as the most important resource in the Chinese Communist Party (CCP)’s life-and-death struggle with the West.

In 2013, during his first months in power, Xi talked about data in the same way that Mao Zedong talked about indigenous oil production in the 1950s, during which Mao was seeking to break the regime’s dependence on the Soviet Union.

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“The vast ocean of data, just like oil resources during industrialization, contains immense productive power and opportunities. Whoever controls big data technologies will control the resources for development and have the upper hand,” he told the Chinese Academy of Sciences.

China First, the World Next

The CCP’s scramble for data targets Chinese citizens first. In 2015, China’s General Office of the State Council issued a document entitled “Several Opinions on Using Big Data to Strengthen Services and Supervision of Market Players.” Its main recommendations include using big data to strengthen government supervision and control, including accelerating the construction of a “social credit system” to regulate individual behavior.

In 2016, Xi Jinping asked Chinese intelligence and security agencies to adopt a “24/7 all-round network security situation awareness.”

“What Xi does in China is a good precedent for what he wants to do in other countries—surveillance, and control,” James Lewis, senior vice president of the Center for Strategic and International Studies, told The Epoch Times on July 3.

A Chinese street vendor displays a souvenir with pictures of Chinese President Xi Jinping (Left) and late Chinese Communist Party Chairman Mao Zedong (Right) outside the Great Hall of the People, in Beijing, China, on Nov. 12, 2013. (Feng Li/Getty Images)

Data Grab Extends Overseas

In subsequent years, the CCP expanded its battle for data abroad, with Chinese internet and high-tech companies flocking overseas, including social media company TikTok, e-commerce company Temu, DJI drones, BGI Genomics, and WuXi AppTec, many of which have reportedly become spies for the communist regime.

The Hoover report noted that Chinese tech companies that venture overseas are integrated with the CCP’s data storage and processing, control, and security systems. Through data platforms, apps, and companies controlled by the CCP, Western users access and linger in an entire ecosystem from which the CCP can continually steal data.

“The Party has long required private companies to establish Party organizations and used legal and extralegal measures to bend private companies into submission. The pressure has been most acute on technology companies, such as Alibaba,” reads the report. “In 2016, the deputy director of the Cyberspace Administration of China, Ren Xianliang, stated: ‘Since the establishment of Cyberspace Administration of China [in 2014], we place great emphasis on Party-building activity within Internet companies. It is a strategic task for the development of [China’s] Internet industry.’”

U.S. Navy Capt. (Ret.) Carl Schuster, former director of operations at U.S. Pacific Command’s Joint Intelligence Center, believes that CCP leaders are encouraging Chinese companies to expand overseas.

“Given China’s law that directs all information developed in China or by a Chinese company is the property of the CCP and PRC, that harvested data provides insights and information vital to every aspect of China’s efforts to undermine the U.S. and replace as the leading influence on global affairs,” Capt. Schuster told The Epoch Times on July 1.

Alibaba’s co-founder Jack Ma (R) applauds with Tencent Holdings’ CEO Pony Ma during a meeting marking the 40th anniversary of China’s “reform and opening up” policy at the Great Hall of the People in Beijing on Dec. 18, 2018. (Wang Zhao/AFP via Getty Images)

“For example, data on Americans’ entertainment, product, and information source preferences is very useful to PRC business people, trade, and intelligence officials, and political warfare analysts,“ Capt. Schuster said. He gave a concrete example:  ”In conflict, sabotaging American drones or possessing the data on American use of drones might provide insights that better enable PRC military commanders to anticipate and interpret U.S. military operations and plans.”

Anders Corr, principal at Corr Analytics Inc. and Epoch Times contributor, said that while data is key to all modern systems necessary for state power and expansion, including economic, political, and military, too few Americans and allies realize it.

“So [they] freely surrender their data to adversary countries like China and Russia through purchasing their telecom or cybersecurity software, for example,” Mr. Corr told The Epoch Times on July 1.

TikTok User Data Accessible to Beijing

A typical example is TikTok, a subsidiary of Chinese company ByteDance, which has taken Europe and the United States by storm. As of 2023, TikTok has more than 1.677 billion users, of which 1.06 billion are monthly active users. The social media platform boasts over 150 million U.S. TikTok users, over 5 million businesses, and countless small businesses. More than 1 billion videos are viewed on TikTok every day.

TikTok can collect a wide range of data from users, including username, age, email, password, phone number, location, the content of messages, text on clipboards, images and videos, payment card numbers, billing and shipping addresses, user IP addresses, and biometric identifiers such as face prints and sound prints, all of which are accessible for the CCP.

In May, Yu Yintao, a former executive of ByteDance’s U.S. division, sued ByteDance in San Francisco Superior Court, claiming that Chinese officials had unfettered access to the company’s data.

(Dado Ruvic/Illustration/File Photo/Reuters)

Mr. Corr attributed Beijing’s easy access to American data to Americans’ naivety.

“This is in part an American ideological choice based on the naive multi-part assumption that all countries, including those that are authoritarian, are liberalizing their economies and democratizing their societies, and that global transparency serves this process. In fact, Beijing increasingly controls its own data while exploiting the transparency of the rest of the world,” he said.

CCP-funded DJI Dominates Global Drone Market

Another Chinese company making a big push into the United States is Da-Jiang Innovations (DJI).

According to a report by Drone Industry Insights, the global drone market was valued at $30.6 billion in 2022 and is expected to grow to $55.8 billion by 2030. Chinese companies dominate this expanding market, with DJI controlling more than half of the industry as a whole.

Founded in 2006, DJI rose to prominence by producing drone models and parts, eventually becoming a leader in the drone industry. In this process, American venture capital played a key role. In 2014, DJI raised $30 million from Sequoia China; in 2015, it raised $75 million from Accel Partners, giving it a valuation of more than $10 billion. In just four years—from 2011 to 2015—DJI’s revenue grew a hundredfold, thanks to American investors.

Backed by U.S. venture capital and the CCP, DJI dominates the global commercial drone market. Although the company’s market share declined by 15 percent in 2021, it still accounted for 54 percent of the global commercial drone market.

However, although the company is nominally private, a 2022 Washington Post report claimed that DJI actually receives funding from the CCP’s state-owned Assets Supervision and Administration Commission of the State Council.

A DJI Mavic 2 Enterprise drone equipped with a thermal sensor, used by police to check people's temperature, is pictured in flight in Treviolo, Italy, on April 9, 2020. (Miguel Medina/AFP via Getty Images)

The CCP has used DJI’s absolute advantage in the global drone market to collect American data. In one example, in 2016 DJI partnered with the Wrightsville Beach (North Carolina) Fire Department to provide two drones for free, “on the provision that DJI retain the data it gathered,” the Hoover study said. According to Bard College’s 2020 Public Safety Drones report, 1,578 state and local public safety agencies in the United States use drones. Of the drones used by these agencies, DJI drones account for about 90 percent.

According to a 2017 U.S. Army memo, DJI shares critical infrastructure and law enforcement data with the Chinese regime. In 2019, the U.S. Department of Homeland Security warned that Chinese-made drones could send sensitive flight data to the Chinese government.

BGI Sees Americans’ Genetic Info as ‘Big Data’

The field of biological genetics has not been spared, either.

BGI Genomics, a leading global provider of genome sequencing, was described by its co-founder Wang Jian as a “big data company.”

In 2016, BGI established a national gene bank in Shenzhen with the mission to “store, manage, and utilize genetic resources” and “serve the strategic needs of the country.”

The gene bank is operated by BGI but approved and funded by several CCP agencies, including the Ministry of Industry and Information Technology and the National Health and Family Planning Commission.

Genetic resources are the strategic resources of the regime and the basis for future competition in the bioeconomy, according to the website of the National Development and Reform Commission, which also approved the gene bank’s development.

The logo of Chinese gene firm BGI Group is seen at its building in Beijing, on March 25, 2021. (Carlos Garcia Rawlins/Reuters)

The BGI–CCP partnership in the gene bank means that genetic data collected from Western countries is at risk of entering the Chinese genetic database and being used as a “strategic resource.”

In 2018, BGI announced a partnership with Johns Hopkins University and Mount Sinai Hospital in Toronto, Canada to study pancreatic cancer and develop a diagnostic test for preterm birth. BGI provided sequencing services for both projects.

In 2021, BGI’s prenatal test brand, NIFTY, was investigated in five Western countries for links with the Chinese military. At the time of the Hoover report’s publication, 8.4 million women worldwide had taken the BGI test.

Data Heist Is Part of ‘Dare to Struggle’

Experts see these actions for data dominance as part of Beijing’s struggle with the West.

On March 6, Mr. Xi told delegates of the CCP’s top political advisory body, “Western countries, led by the U.S., are implementing all-round containment, encirclement, and suppression against us, bringing unprecedented and severe challenges to our country’s development.”

In October 2022, the CCP amended its party constitution to include a new imperative: “dare to struggle.”

In March 2021, Mr. Xi published an article in the CCP’s party media saying, “The world is entering a period of economic development dominated by the information industry. We have to grasp the opportunity of digitalization, networking, intelligent integration, and development ... to promote the deep integration of the internet, big data, artificial intelligence with the real economy, and make the digital economy bigger and stronger.”

John Hemmings, senior director of the Indo-Pacific Foreign and Security Policy Program at the Pacific Forum, said Mr. Xi views the issue through a very Marxist historical, materialist lens.

“Like the steam engine essentially set the pattern and social structure of the Industrial Revolution and of capitalism, data is going to have that impact on society and create the sort of structure of society in a new way, so Xi Jinping wants China to be ahead of that coming revolution, that coming data revolution,” he said in March.

Expert Calls for a Ban of Chinese Companies

Mr. Corr suggested that the United States respond to the CCP’s data grab by banning companies from authoritarian countries from doing business in the United States, and working to get allies to do the same.

“The world’s two biggest economies by nominal GDP are the United States and European Union. If both economies banned companies from China and Russia, it would weaken our two most dangerous adversaries and incentivize them to democratize, thus becoming part of the solution globally, rather than the sources of our biggest problems,” he said.

Anders Corr, publisher of the Journal of Political Risk and author of "The Concentration of Power," in New York on Dec. 13, 2021. (Bao Qiu/The Epoch Times)

Capt. Schuster echoed the concern.

“The web and information systems enjoy and provide global reach, so any knowledge-conflict, which is the philosophical foundation underpinning Xi’s concerns about ‘core technologies,’ will be global in nature. That conflict will determine the outcome of what Xi calls the ‘great struggle’ that he hopes will shape the international system for the remainder of this century,” he said.

Mr. Xi has driven China to invest heavily in AI, faster and better computer chips, and Quantum key technologies, which is a technologically complex yet not fully mastered means for providing and attacking communications and computer data encryption, Capt. Schuster warned.

“At the moment, that aspect of the ‘Great Struggle’ favors the West, but China is catching up. The next ten years will determine the outcome. Will the Western entrepreneurial spirit win out over Xi’s centralized and politically oppressive drive to force Chinese researchers to innovate?  The level of Western investment and cooperation may determine the answer,” he said.