PERTH: US President Donald Trump’s Aug 6 executive order aims to force the sale of Chinese service TikTok to a US-based company within 45 days of the order, with both Microsoft and Oracle in discussions for a takeover and amid demands for the US Treasury to receive a "substantial portion" of any deal.
This aggressive action is the latest step in the trade and information war between the two countries.
The threat to the app is fuelled by statements similar to those behind continued US pressure on allies to reject Huawei from critical infrastructure.
This could be the beginning of a US equivalent to the Great Firewall of China. We are walking towards an Internet heavily segregated by geopolitics. It has been interesting times for Chinese tech companies.
Tensions have been growing between various countries and Chinese-owned platforms over the last few months. Of highest notoriety is the spat between the US government and ByteDance, the Beijing-based owner of TikTok.
But the United States is not the only government to have Chinese tech in the crosshairs.
India recently banned over 50 popular Chinese mobile apps, citing national security concerns in a move likely triggered by the China–India border skirmish.
Government agencies around the world are banning internal use of the TikTok app, including the Indian military, and both the US and Australian departments of defence.
The European Union just announced coordinated action by data protection officials to conduct investigations into TikTok privacy concerns. Japan is considering potential restrictions for Chinese-made apps.
ACCESS AND CONTROL OF DATA
No evidence has so far been presented to show that TikTok — or indeed any other Chinese-based app — presents any serious risk to Western democracies. Much concern appears related to the Chinese Communist Party’s (CCP) Jun 2017 National Intelligence Law.
Though many of its powers are not new, it is this law that the Trump administration is likely most anxious about. Any Chinese-based company can, in essence, be compelled by the Chinese government to provide data and systems access for ‘national security’ reasons.
The location of the data is irrelevant, as the location of the owning organisation would dictate the application of the legislation.
TikTok representatives have stated repeatedly that data is stored outside China, typically in US and Singaporean data centres, and that they would not provide data if requested. The reality would likely be very different if ByteDance executives were faced with CCP demands and the likely consequences for failing to comply.
Yet the US Clarifying Lawful Overseas Use of Data (CLOUD) Act, introduced in 2018, effectively places the same obligations on US-based organisations, such as Facebook, Twitter and LinkedIn, compelling access to content in foreign data centres operated by US organisations.
What the US government is proposing would deny China a channel to access TikTok data if it ever wanted it — and therefore allay concerns over Chinese data access and influence — instead of providing for US oversight of the platform.
TRADE WAR IS SET TO ESCALATE
This access would be subject to control and scrutiny with a perception of protection for civil liberties.
These issues may not be of concern to some users but for others caught up in the technology transfer, they may be worried by US oversight of yet another form of social media.
Perhaps it is naive to assume these practices aren’t already widespread — Edward Snowden revealed, among other things, that the NSA routinely intercepted the export of Cisco networking equipment to embed surveillance technologies.
With many now describing a fractured internet, there’s significant concern over the impact of the US government increasingly exercising its powers with such actions as indictments against Huawei and this latest legislation forcing the sale or discontinuation of foreign apps.
There are indications that the US trade war is set to escalate, targeting other Chinese companies and enacting further restrictions, such as on global marketplaces like Alibaba.
If the United States proceeds to impose control on foreign-owned organisations, it will have dire wider consequences. And like it or not, the US government has significant influence over allies.
The Huawei debate shows how allegations — as yet publicly unfounded — block the distribution and use of leading technology the world over, costing years in lost technological development and billions in economic development. Is this the best approach to addressing concerns about China's influence over technology?
The concept of a “digital iron curtain” is under heavy debate. If the United States implements further action against technology companies, and influences others to do the same, countries are going to face a stark choice between US or Chinese versions of the Internet.
Information and services will be a restricted commodity with access dictated by the government in your country of residence.
This fragmentation of the Internet is a reversal of globalisation and the principles of free and open trade, the features of which allowed the United States, China and all other market economies around the Asia Pacific to grow to their current positions as economic powerhouses.
Paul Haskell-Dowland is Associate Professor and Associate Dean (Computing and Security) in the School of Science at Edith Cowan University. This commentary first appeared on East Asia Forum. Read it here.