TikTok is a popular short-form video app that has seen explosive growth since launching globally in 2018. As of 2022, TikTok has over 1 billion monthly active users worldwide and was the most downloaded app in 2020 and 2021 (https://saasscout.com/statistics/tiktok-stats/). TikTok’s fun, quirky videos have developed a highly engaged user base, especially among younger audiences.
However, concerns have emerged around TikTok’s ownership and data practices. TikTok is owned by ByteDance, a Beijing-based tech company. This has led to fears that data on TikTok’s international users could be accessible to the Chinese government. There are also worries about how content is moderated on TikTok and whether censorship practices from China could impact the global platform. Understanding the truth behind who owns TikTok and how data is handled will be the focus of this article.
TikTok’s Origins
TikTok traces its origins back to China, where the short-video sharing app Douyin was founded in 2016 by Zhang Yiming as part of the Chinese technology company ByteDance. Douyin quickly gained popularity in China for allowing users to create and share brief videos set to music.
In 2017, ByteDance acquired the similar short-video app Musical.ly, which was already hugely popular among teenagers in the United States and other Western markets. ByteDance decided to merge the two apps in order to create one cohesive global brand.
In August 2018, the international version of Douyin was launched outside of China under the new name TikTok. TikTok combined the features of Douyin and Musical.ly into one app and began its rapid rise in popularity worldwide.
Thus TikTok was born out of the merger of two Chinese-owned video sharing apps, one originating in China itself (Douyin) and the other acquired by a Chinese company (Musical.ly). This Chinese ownership origin would later become the source of controversies surrounding TikTok.
Sources:
The history of TikTok – thePROSPECTUS
The Evolution of TikTok: From Musical.ly to Global …
TikTok’s Parent Company
The parent company of TikTok is ByteDance, which is headquartered in Beijing, China. ByteDance was founded in 2012 by Zhang Yiming, who still serves as the CEO.
According to Entrepreneur, “ByteDance, ownership structure works as a Cayman Islands shell company that owns TikTok through two more layers of subsidiaries.” This complex corporate structure has caused some confusion and controversy over who exactly controls TikTok and its data.
However, there is no doubt that ByteDance is a Chinese company, with most of its operations and employees based in China. And as the founder and CEO, Zhang Yiming exerts significant influence and control over ByteDance and its products like TikTok.
TikTok’s Presence Outside China
Although TikTok operates locally through subsidiaries in various markets outside of China, its ultimate ownership still lies with the Chinese company ByteDance. TikTok’s presence internationally began when ByteDance acquired Musical.ly in 2017 and merged it into TikTok the following year. This gave TikTok access to Musical.ly’s existing user base outside of China.
Today, TikTok has an international corporate structure with locally registered companies in markets like the US, UK, India, Japan, and more. For example, TikTok US operations are handled by TikTok Inc., registered in California. And TikTok Europe is operated by TikTok Information Technologies UK Limited. Despite having local subsidiaries, ByteDance remains the sole owner of TikTok globally.
According to TikTok, their structure of having local teams moderating content and dealing with data storage and security is aimed at better adapting to each market’s needs and regulations. However, the Chinese parent company still has control over product, technology, and business strategies across all TikTok subsidiaries worldwide.1
Data and Moderation Concerns
There have been growing concerns over TikTok’s content moderation policies and access to user data. Several incidents have led to allegations that TikTok censors content that is deemed politically sensitive by the Chinese government:
In September 2019, The Guardian reported that leaked documents showed moderators were instructed to censor videos mentioning Tiananmen Square, Tibetan independence, and other political topics. Moderators were told to mark these videos as “violating local laws” to prevent their spread.
That same year, TikTok apologized after blocking a user who posted videos criticizing China’s treatment of Uighurs. The company claimed it was an “error” but faced backlash over perceived censorship.
There are also concerns that TikTok’s parent company ByteDance could be compelled by Chinese authorities to provide access to TikTok’s data on U.S. users. TikTok denies that it would hand over data, but some experts argue the legal infrastructure in China makes it difficult to resist such requests.
Attempts to Address Concerns
In response to data and moderation concerns, TikTok has made some key changes in recent years. Most notably, TikTok has moved to store U.S. user data outside of China. According to a 2023 report, TikTok now stores U.S. user data in Virginia with backup storage in Singapore. TikTok has stated this move was made to reassure users and regulators that data would be kept safely away from the Chinese government.
TikTok has also worked to localize its content moderation operations. In 2021, TikTok opened a ‘transparency center’ where outside experts could observe its operations. Moderation is now handled regionally by localized teams, with the U.S. team operating independently from China. According to TikTok, this ensures community guidelines and laws are interpreted appropriately for each local market.
Ongoing Controversy
Despite TikTok’s recent efforts, questions remain about the level of autonomy that TikTok truly has from its parent company ByteDance (https://www.cnbc.com/2021/06/25/tiktok-insiders-say-chinese-parent-bytedance-in-control.html). Many U.S. regulators and policymakers feel that ByteDance still has too much control over TikTok, especially when it comes to accessing American user data.
In March 2023, TikTok CEO Shou Zi Chew testified before Congress that TikTok is not controlled by the Chinese government nor ByteDance. However, human rights groups challenged this claim, arguing there is no transparency into TikTok’s relationship and obligations to ByteDance (https://www.hrw.org/news/2023/03/24/problem-tiktoks-claim-independence-beijing).
While TikTok states its data is stored in the U.S. with backups in Singapore, there are concerns that its parent company ByteDance could be forced to hand over data to Chinese authorities if requested. Many feel ByteDance’s level of control and influence over TikTok’s operations and decision-making means user data may not be fully protected (https://apnews.com/article/tiktok-bytedance-shou-zi-chew-8d8a6a9694357040d484670b7f4833be).
Bans and Restrictions
One of the most notable bans of TikTok occurred in India starting in 2020. The Indian government banned TikTok and dozens of other Chinese apps over concerns about data practices and security risks. This ban cut TikTok off from one of its largest markets, as India had been the app’s biggest country for downloads and monthly active users.
The Indian government justified the ban by claiming the apps were “prejudicial to sovereignty and integrity of India, defence of India, security of state and public order.” The ban has remained in place ever since, despite TikTok’s efforts to negotiate with the Indian government. According to The Verge, TikTok has had to severely cut staff and operations in India due to the ongoing ban.
In the United States, there were attempts by the Trump administration to ban TikTok over similar data security concerns. However, federal courts blocked the proposed bans in 2020, ruling that the bans were likely overreaches of executive authority. While TikTok is not banned in the US, it continues to face government scrutiny over its data practices and moderation.
The Future
Uncertainty remains over TikTok’s independence from its Chinese parent company ByteDance. Despite efforts to assure Western governments about its data security, concerns persist that the app could be forced to share data with the Chinese government or censor content aligned with Chinese interests (TikTok Statistics You Need to Know in 2024).
However, TikTok continues to see massive global growth, with over 1.5 billion monthly active users as of 2023 (TikTok Revenue and Usage Statistics (2024)). The app shows no signs of slowing down, especially among younger demographics. While regulatory battles over data privacy and content moderation continue, TikTok seems poised to further solidify its position as one of the world’s leading social media platforms.
Conclusion
To recap, TikTok originated in China as a video sharing app owned by the Chinese company ByteDance. Although TikTok now operates internationally, its ties to China have raised concerns over data privacy and censorship given China’s restrictive policies.
TikTok claims it stores international user data outside China and does not remove content based on Chinese regulations. However, TikTok has faced criticism over moderation of political and activist content, and questions remain about the degree of influence and access the Chinese government has.
Attempts to address these issues like TikTok’s move to store US user data in Oracle servers have not fully satisfied lawmakers. As a result, TikTok faces ongoing scrutiny in the US and other countries over fears its China ownership represents a national security threat. While a full ban in the US appears unlikely, the controversy illustrates how TikTok’s growth outside China has been impacted by its Chinese origins.
