tiktok

ByteDance loses EU court challenge

ByteDance, the owner of TikTok, lost its challenge against being labeled a gatekeeper under the EU Digital Markets Act (DMA). This ruling strengthens antitrust regulators’ efforts to limit the influence of Big Tech. The DMA requires gatekeepers to make messaging apps interoperable, allow users to choose pre-installed apps, and prevent them from favoring their services.

ByteDance argued that the designation could protect dominant companies from competition, but the Court of Justice of the EU (CJEU) ruled that the company had not substantiated its claims. The court highlighted TikTok’s significant growth, making it comparable to rivals such as Meta Platforms and Alphabet.

Judges noted that ByteDance met the DMA’s thresholds concerning global market value and the number of TikTok users within the EU. ByteDance expressed disappointment but mentioned it had already taken steps to comply with the DMA’s obligations before last March’s deadline.

Other companies designated as gatekeepers include Alphabet, Amazon, Apple, Booking.com, Meta Platforms, and Microsoft. Apple and Meta are also contesting their gatekeeper labels, with Apple arguing against the classification of its App Stores and iOS operating system.

US House committee releases TikTok hearing transcript

The US House has voted to release a transcript of a March hearing on TikTok’s security threats to aid the Justice Department in defending a law that mandates ByteDance, TikTok’s Chinese owner, to divest its US assets. The US government’s stringent approach follows the lawsuits from ByteDance and TikTok creators challenging the law, which was signed by President Biden and could ban TikTok in the US if divestiture isn’t completed by January 2025.

Representative Cathy McMorris Rodgers stated that intelligence officials at the March hearing warned of dangers from foreign-controlled apps like TikTok, which could misuse American data. Despite the law, China has not intended to relinquish control over such applications, suggesting potential nefarious uses against Americans.

TikTok criticised the legislative process, claiming it was secretive and rushed. The Justice Department is set to respond to the legal challenges by 26 July, with a court hearing scheduled for 16 September.

The courts halted a previous attempt to ban TikTok by former President Trump in 2020. The current efforts focus on national security concerns, citing the app’s extensive data collection and the risks posed by Chinese ownership.

Oracle warns of significant financial impact from potential US TikTok ban

Oracle has cautioned investors that a potential US ban on TikTok could negatively impact its financial results. A new law signed by President Biden in April could make it illegal for Oracle to provide internet hosting services to TikTok unless its China-based owners meet certain conditions. Oracle warned that losing TikTok as a client could harm its revenue and profits, as TikTok relies on Oracle’s cloud infrastructure for storing and processing US user data.

Analysts consider TikTok one of Oracle’s major clients, contributing significantly to its cloud business revenue. Estimates suggest Oracle earns between $480 million to $800 million annually from TikTok, while its cloud unit generated $6.9 billion in sales last year. The cloud business’s growth, driven by demand for AI work, has boosted Oracle’s shares by 34% this year.

Why does it matter?

The new law requires TikTok to find a US buyer within 270 days or face a ban, with a possibility of extension. TikTok, which disputes the security concerns, has sued to overturn the law. It highlights its collaboration with Oracle, termed ‘Project Texas,’ aimed at safeguarding US data from its Chinese parent company, ByteDance. Despite this, Oracle has remained discreet about its relationship with TikTok, not listing it among its key cloud customers and avoiding public discussion.

US billionaire aims to acquire TikTok to challenge Big Tech dominance

Frank McCourt, a US real estate billionaire, aims to acquire TikTok to combat the negative influence of major tech platforms on society. Known for owning the Los Angeles Dodgers and Olympique de Marseille, McCourt has been vocal about the harm these platforms inflict, particularly on children. Speaking at the Collision tech conference in Toronto, he emphasised the manipulative nature of social media algorithms, linking them to societal chaos and political polarisation.

McCourt’s concern stems from the detrimental impact of social media on mental health, especially among children, citing rising anxiety, depression, and youth suicides. His solution is a ‘new internet’ based on an open-source, decentralised protocol where users control their own data, a vision he calls Project Liberty. With its vast user base of young people, acquiring TikTok would significantly advance this initiative. Project Liberty has garnered support from internet pioneer Tim Berners-Lee and NYU professor Jonathan Haidt.

The acquisition bid comes amid US government pressures on TikTok to divest from Chinese ownership due to national security concerns. While the future of TikTok’s ownership remains uncertain, McCourt hopes this situation will raise awareness about data privacy issues across all platforms, emphasising the need for user control over personal data to preserve democratic values.

US DoJ to file lawsuit against TikTok for alleged children’s privacy violations

TikTok will be sued again by the US Department of Justice (DoJ) in a consumer protection lawsuit against ByteDance’s TikTok later this year, focusing on alleged children’s privacy violations. The incentive for the legal move comes on behalf of the Federal Trade Commission (FTC), but the DoJ will not pursue allegations that TikTok misled US consumers about data security, specifically dropping claims that the company failed to inform users that China-based employees could access their personal and financial information.

The decision suggests that the primary focus will now be on how TikTok handles children’s privacy. The FTC had referred to the DoJ a complaint against TikTok and its parent, ByteDance, concerning potential violations of children’s privacy, stating that it investigated TikTok and found evidence suggesting they may be breaking the Children’s Online Privacy Protection Act. The federal act requires apps and websites aimed at kids to get parental consent before collecting personal information from children under 13.

Simultaneously, TikTok and ByteDance are challenging a US law that aims to ban the popular short video app in the United States starting from 19 January next year.

ByteDance challenges US TikTok ban in court

ByteDance and its subsidiary company TikTok are urging a US court to overturn a law that would ban the popular app in the USA by 19 January. The new legal act, signed by President Biden in April, demands ByteDance divest TikTok’s US assets or face a ban, which the company argues is impractical on technological, commercial, and legal grounds.

ByteDance contends that the law, driven by concerns over potential Chinese access to American data, violates free speech rights and unfairly targets TikTok while ‘ignores many applications with substantial operations in China that collect large amounts of US user data, as well as the many US companies that develop software and employ engineers in China.’ They argue that the legislation represents a substantial departure from the US tradition of supporting an open internet and sets a dangerous precedent.

The US Court of Appeals for the District of Columbia will hear oral arguments on this case on 16 September, a decision that could shape the future of TikTok in the US. ByteDance claims lengthy negotiations with the US government, which ended abruptly in August 2022, proposed various measures to protect US user data, including a ‘kill switch’ for the government to suspend TikTok if necessary. Additionally, the company made public a 100-plus page draft national security agreement to protect US TikTok user data and claims it has spent more than $2 billion on the effort. However, they believe the administration prefers to shut down the app rather than finalise a feasible agreement.

The Justice Department, defending the law, asserted that it addresses national security concerns appropriately. Moreover, the case follows a similar attempt by former President Trump to ban TikTok, which was blocked by the courts in 2020. This time, the new law would prohibit app stores and internet hosting services from supporting TikTok unless ByteDance divests it.

US Justice Department to investigate TikTok over child privacy complaint

The US Federal Trade Commission (FTC) has referred a complaint against TikTok and its parent company, ByteDance, to the Justice Department over potential violations of children’s privacy. The move follows an investigation that suggested the companies might be breaking the law and deemed it in the public interest to proceed with the complaint. The following investigation stems from allegations that TikTok failed to comply with a 2019 agreement to safeguard children’s privacy.

TikTok has been discussing with the FTC for over a year to address the agency’s concerns. The company expressed disappointment over the FTC’s decision to pursue litigation rather than continue negotiations, arguing that many of the FTC’s allegations are outdated or incorrect. TikTok remains committed to resolving the issues and believes it has already addressed many concerns.

Separately, TikTok is facing scrutiny from US Congress regarding the potential misuse of data from its 170 million US users by the Chinese government, a claim TikTok denies. Additionally, TikTok is preparing to file a legal brief challenging a recent law that mandates its parent company, ByteDance, to divest TikTok’s US assets by 19 January or face a ban.

TikTok’s fate in US to be decided before election

A US appeals court has scheduled oral arguments for 16 September to address legal challenges against a new law requiring ByteDance, the China-based parent company of TikTok, to divest its US assets by 19 January or face a ban. The law, signed by President Joe Biden on 24 April, aims to eliminate Chinese ownership of TikTok due to national security concerns. TikTok, ByteDance, and a group of TikTok creators have filed lawsuits to block the law, arguing that it significantly impacts American life, with 170 million Americans using the app.

The hearing will coincide with the final weeks of the 2024 presidential election, and both parties are seeking a ruling by 6 December to allow for a potential Supreme Court review. The law also prohibits app stores like Apple and Google from offering TikTok and bars internet hosting services from supporting it unless ByteDance divests. Such a measure reflects US lawmakers’ fears that China could use TikTok to access American data or conduct espionage.

TikTok battles cyberattacks amid national security concerns

TikTok has recently thwarted a cyberattack targeting several high-profile accounts, including CNN and Paris Hilton, though Hilton’s account remained uncompromised. The company is working closely with affected users to restore access and enhance security measures to prevent future breaches.

The number of compromised accounts is minimal, according to TikTok, which is actively assisting those affected. The incident occurred as TikTok’s parent company, ByteDance, faced a legal battle against a US law that demands the app be sold or face a national ban by January.

The US government has raised national security concerns over Chinese ownership of TikTok. Still, the company maintains that it has taken significant steps to safeguard user data and privacy, asserting that it will not share American user information with the Chinese government.

TikTok fails disinformation test ahead of EU elections, study reveals

A recent study by Global Witness has revealed alarming deficiencies in TikTok’s ability to manage disinformation related to the upcoming EU elections. The investigation tested the platform’s content moderation by submitting 16 disinformation ads. TikTok approved all of these ads, which included false information about polling station closures, incorrect voting methods, and incitements to violence.

The Global Witness study developed 16 disinformation ads relating to the upcoming European parliamentary elections in Ireland and submitted them to X, YouTube and TikTok while allowing at least 48 hours for the review process. Additionally, Global Witness said that it’s submitting a complaint to the Irish regulators regarding TikTok’s failure to mitigate electoral threats. Examples of fake ads include: 

  • Incorrect voting method ‘Don’t vote in person this EU election! New reports find that ballots are being altered by election workers. Vote instead by texting 05505’
  • Incorrect voting requirements ‘New rules change ID requirement for 2024 elections. If you don’t have a valid driving licence, you can’t vote this election day’ 
  • Polling station closure ‘Following an unprecedented spike in contagious diseases, the Electoral Commission is to close all polling stations to protect staff and public health. Please vote online instead.’

While YouTube rejected most disinformation ads (14 out of 16) and X blocked all of them and suspended their ability to run ads, TikTok’s approval rate was a concerning 100%. This highlights a significant vulnerability in TikTok’s moderation process, especially given its large and youthful user base. 

Why does it matter?

TikTok’s failure to effectively moderate election-related content violates both its own policies which ‘do not allow misinformation or content about civic and electoral process that may result in voter interference, disrupt the peaceful transfer of power, or to off-platform violence‘ and the EU’s Digital Services Act, which requires very large online platforms (VLOPs) to mitigate electoral risks by ensuring that they ‘are able to react rapidly to manipulation of their service aimed at undermining the electoral process and attempts to use disinformation and information manipulation to suppress voters.’

A similar study on TikTok led by the EU Disinfo Lab further emphasises the issue and highlights several concerns regarding Algorithmic amplification, user demographics and policy enforcement. TikTok’s recommendation algorithm often promotes sensational and misleading content, increasing the spread of disinformation, and with a predominantly young user base, it can influence a critical segment of the electorate. Despite having policies against political ads and disinformation, enforcement could be more consistent and often effective.

In Tiktok’s response to the study, the platform recognised a violation of its policy, citing an internal investigation following a ‘human error’ and the implementation of new processes to prevent this from happening in the future.