TikTok CEO says 'Project Texas' to ease US security concerns

TikTok CEO says ‘Project Texas’ to ease US security concerns

Hit video TikTok is investing heavily to address US data security concerns and expects to be able to provide a satisfactory solution with partner Oracle Corp.

Hit video TikTok is investing heavily to address US data security concerns and expects to be able to provide a satisfactory solution with partner Oracle Corp.

TikTok CEO Shou Zi Chew said the company is working on an effort called Project Texas, which would isolate sensitive data from its US users so that only employees in the US would have access. He called these efforts “very difficult and expensive to build,” but they took aim at the concerns of American officials.

“It is unprecedented. No company has attempted this,” Chiu said at the Bloomberg New Economy Forum in Singapore on Wednesday. “I am very confident that through the detailed discussions we will have, we will come up with a solution that reasonably addresses national security concerns.”

TikTok has come under fire because the employees are in China, where ByteDance Ltd. is headquartered. They were able to take advantage of US user data. Just this week, FBI Director Christopher Wray said the bureau was “very concerned” that the Chinese government could influence the app to control the data or software of millions of users, and its recommendation algorithm — which determines which videos users watch next.

Chiu backed away from the idea that the social media company would check citizenship before deciding who has access to certain data.

“There is no consumer Internet company that I know of that regulates access to data by nationality,” he said.

Instead, he said, data controls should be geographic to ensure security.

“Only a US-based entity will be able to access a certain set of US-protected data,” he said of TikTok’s strategy with Oracle, which will host the app’s data.

TikTok is the crown jewel of ByteDance’s app portfolio, an online repository of small-format clips that have taken the short video format mainstream and garnered users from US social media services such as Meta Platforms Inc. and Google’s YouTube.

Its success has made the Chinese company the wealthiest startup in the world, and catapulted co-founder Zhang Yiming into the ranks of billionaire entrepreneurs. However, Beijing-based ByteDance is emerging from two rough years, when first the Trump administration and then its government sought to limit its growing influence over user data and the broader public. Qiu, a Singaporean national, joined ByteDance from Chinese mobile phone maker Xiaomi Corp in 2021 amid a series of leadership shakeups.

Washington’s concerns centered on the massive amounts of data that TikTok was extracting from its one billion-plus users, the potential for disinformation to spread among America’s youth, and the threat of espionage. Biden’s White House is now working to forge a security agreement with TikTok to spare the app an outright US ban that was introduced during the Trump era, but critics fear such an approach likely won’t prevent data from leaking to China.

On Wednesday, Beijing accused Washington of deliberately shrinking Chinese companies abroad.

“Spreading false information and using it as a pretext to crack down on relevant Chinese companies has become a common practice of the United States,” Chinese Foreign Ministry spokeswoman Mao Ning told reporters at a regular briefing.

FBI ‘very concerned’ over TikTok data issue (2)

Chew runs a still fast-growing video platform, but it is not immune from the fallout from the global downturn that has hit Western internet giants. TikTok’s chief recently cut the app’s ad forecast for 2022 to $10 billion from at least $12 billion previously, Bloomberg News reported this month, reflecting declining marketing spending worldwide.

Parent ByteDance has delayed plans for an initial public offering as investors flee risky assets. In September, it offered to buy back up to $3 billion of its own shares at a valuation of about $300 billion, giving existing backers a way to cash in. Domestically, TikTok-style app Douyin competes with Tencent Holdings Ltd. and Alibaba Group Holding Ltd. In fields ranging from entertainment to e-commerce.

The New Economy Forum is organized by Bloomberg Media Group, a division of Bloomberg LP, the parent company of Bloomberg News.

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