What will be China’s action if Tiktok is banned?

TikTok Ban News: TikTok owners are once again facing a troubled situation in the US, where the US House of Representatives has issued an ultimatum to disinvest within six months or face shutdown. In Australia, opposition leader Peter Dutton and Senator James Patterson, shadow home affairs spokesman, want Canberra to follow suit.

TikTok, owned by Beijing-based tech giant ByteDance, has faced this situation before. It countered a similar order by the Trump administration banning video creation and sharing apps in the US several years ago. To ease US security concerns about user data potentially being handed over to the Chinese Communist Party, TikTok promised to transfer US user data to the US-based Oracle Cloud.

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However, TikTok has reportedly struggled to deliver on this promise. TikTok’s resistance to US pressures is increasing. The social media platform’s survival in Western markets depends on its ability to deal with these geopolitical complexities. This situation will test TikTok’s adaptability and strategic approach as well as the strength of its user base. Over the past four years, TikTok has seen tremendous growth in both its user base and advertising revenue, although this has begun to slow somewhat in the US.

Last year, ByteDance was valued at US$220 billion, down from US$500 billion in 2021, but it still ranked as the world’s most valuable non-public startup. This valuation not only highlights its worldwide appeal, but also makes it uniquely equipped to deal with US regulatory hurdles. Indeed, TikTok’s response to the latest US ban attempt has demonstrated the power of its resistance.

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On March 7, the platform directly engaged its users with a pop-up message urging them to contact Congress to complain. In doing so, it turned the narrative from a direct conflict between itself and Washington to a broader conflict between the US government and American citizens over freedom of expression. The bill that would force ByteDance to sell the app or face a nationwide ban has yet to pass the Senate.

President Joe Biden has said that if this bill is passed, he will sign it. Although the bill has broad support from both sides of the political spectrum, senators from both parties will need to consider the potential reaction of young people in a crucial election year.

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Already, former President Donald Trump – the Republican nominee in the 2024 presidential election – has hit back at a potential TikTok ban, underscoring ByteDance’s growing political influence. Should the bill become law, civil liberties groups could also challenge it in US federal court as a violation of TikTok users’ First Amendment rights to free speech.

Some groups are already mobilizing for action. Federal judges have in the past rejected attempts at sanctions in the US on various grounds. (One of these cases was brought by TikTok users, but was allegedly shaped by TikTok and its Chinese parent company.) A new challenge, based on freedom of expression, has not yet been tested in court. , which may ultimately lead to an appeal to the US Supreme Court.

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China could retaliate in other ways Although US national security officials were briefing US senators this week about the threats posed by TikTok, it is not the only reason the social media app has run into trouble in Washington. TikTok has also been targeted by the growing technological rivalry between the US and China, with many fearing far-reaching technological disruption or even an all-out technological cold war between the countries.

Faced with potential pressure to sell at low prices, and given the challenges faced by other Chinese tech companies like Huawei in the West, ByteDance may decide to exit the US market altogether. Such a decision could prompt retaliatory trade sanctions or other actions by the Chinese government due to nationalist pressures. This could boost ByteDance’s stature in China – as happened with Huawei after it was banned in the US.

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China has already blocked many American media outlets, social media platforms and other websites like Facebook, Twitter and Google. But it could retaliate with sanctions, as it has done in the past against US data firms, officials and researchers (with limited effect). The Chinese government has also said that any sale of TikTok would have to comply with its law on technology exports, which requires a license to export certain technologies.

It’s not entirely clear how the law will apply to TikTok, but some experts believe it could include the algorithms that govern the app. This means that theoretically China can prevent ByteDance from selling this technology to any foreign company. TikTok’s plight in the US could also set an example for other Chinese tech companies like e-commerce platforms Temu and Shein.

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Both companies are also under increasing congressional scrutiny, making them apprehensive about potential mandates for future divestitures or other regulatory hurdles. Could Australia be next? In Australia, TikTok is already banned on government-issued devices. Now, there is renewed momentum for a nationwide ban as well.

As a close ally of the US and a major trading partner of China, Australia is in a particularly vulnerable position. It may be forced to choose between the US strategy of decoupling its tech industry from China or prioritizing improving its relations with Beijing. As the debate in the US progresses, the points of difference between the two major parties in Australia are likely to become more defined.

Prime Minister Anthony Albanese said his government has no plans to follow the US lead on the TikTok ban – at this stage – but that could change as the next federal election approaches. Politicians on both sides will need to take into account the impact of a potential ban among TikTok supporters as well as the Chinese-Australian community. Many Chinese-Australians will see the ban as another slap in the face to their country of origin and evidence of an anti-China foreign policy.

(This article published in The Conversation is written by Marina Yu Zhang and Wanning Sun of the University of Technology Sydney and is brought to us by PTI)