TikTok was launched as Douyin in China in September 2016, went global in 2017 as TikTok, was the most downloaded Apple iOS app over the first half of 2018, and by October 2018, was the top downloaded app for Android. In the month of June 2019, it’s estimated that more than half of TikTok downloaders were still active users.
Beijing-based ByteDance, TikTok’s parent company, has a valuation of $75 billion and is estimated to be the world’s most valuable startup, according to The Verge. TikTok has primarily featured short-form videos lasting from 15 to 60 seconds that can be embellished with music tracks and filters. But the company closed a $1.4 billion private placement in December 2018 to invest in machine learning and artificial intelligence (AI).
Thousands of social media influencers, talent agents, brand managers, entertainment executives, and screaming teenage fans descend each summer on Anaheim Convention Center for the VidCon creators conference. YouTube celebrities have dominated the show for a decade, but they were overshadowed at this year’s July 11–13 event by the ‘TikTokers’ popularity.
Unlike YouTube, where content creators can only get paid for video and channel-page advertising at rates set by Google, TikTok doesn’t take a cut for running ads. As a result, TikTok influencers with higher numbers of followers and engagement rates can avoid the middleman to directly negotiate with the brands for much higher advertising dollars.
In addition to generating growth through the users’ appetite for TikTok’s karaoke lip-sync fun, ByteDance spent $1 billion in advertising promotions in 2018 on Facebook, Instagram, and Snapchat in order to drastically spike TikTok’s expansion, The Wall Street Journal reported.
The combination of rapid growth and no pathway for the company to profit has raised concerns that TikTok is a vehicle for China to “guzzle” U.S. data, despite extensive restrictions for U.S.-based companies that are mining personal information without user permission.
The Chinese cyber-surveillance state features mass video-surveillance projects that incorporate facial-recognition technology; voice-recognition software that can identify speakers on phone calls; and a sweeping and intrusive program of DNA collection. Beijing plans to implement a nationwide social credit system intended to assess the conduct of every Chinese citizen.
According to Axios, Chinese AI firms can engage in unlimited cyber-surveillance of China’s 1.4 billion residents to “build powerful and lucrative predictive models.” But those predictors “do not always travel well across cultural borders.” TikTok “ingesting” massive amounts of U.S. data will leverage the effectiveness of China’s AI predictors.
Graham Webster, digital economy fellow at the Washington-based think tank New America, has stated that it is a China public policy objective to use its “AI technology to strengthen national online public opinion monitoring capabilities, improve social governance capabilities, and ensure national security.”
Webster warns that there are substantial U.S. national security risks associated with TikTok’s AI capability. As an example, a U.S. military officer whose child is making memes on TikTok could be cyber-surveilled by Chinese intelligence services.