TikTok, and its Chinese parent company ByteDance, have been under US government scrutiny over reports of insufficient data security. One of the world's most popular social media apps is currently in talks with the US Department of Justice regarding changes to its data security policy.
The stakes are high for the Chinese-owned social media app, as failing to address the security concerns would bring into question its continued operation in the US. TikTok needs to make changes to its data security and governance to alleviate fears of misuse of user data, or face divestment. If TikTok fails to bolster app's safeguards of user data, ByteDance will have to sell it.
The Department of Justice heads negotiations with TikTok, although both the U.S. Department of Treasury and the Committee on Foreign Investment in the United States (CFIUS) have a say in the matter.
TikTok has shown willingness to cooperate with the US government on resolving security issues and is open to negotiations. So far, the social media giant has been reluctant about talking to the media, although the company did reveal that it was “on a path to fully satisfy all reasonable U.S. national security concerns,” and that they were, quote, “confident” about the outcome of negotiations.
The US Department of Treasury isn’t so convinced. The Department has raised concerns over the deal’s capability to “sufficiently resolve” national security issues.
The Biden administration and TikTok have put together a preliminary agreement to address national security concerns and the necessary steps to resolve them, but they’ve made no final decisions as of yet. Both parties at the negotiation table are hoping to find a mutually agreeable solution to the problem, leading us to believe that it is just a matter of time before they reach an agreement.
As part of the agreement, TikTok announced they would store American user data in U.S.-based Oracle servers. Naturally, the federal government consulted with Oracle on the matter, even though the cloud company is not directly involved in negotiations.
As a reminder, in 2020, a U.S. national security panel ordered ByteDance to divest TikTok over fears that proprietary user data was ending up in communist China, thus harming US national interests. The Biden administration overturned the order and initiated discussion over security concerns.
TikTok has over one billion active users globally and considers the US as its primary market. It is also the largest market for the Chinese social media app, necessitating successful resolution of all security concerns.