Experts, China warn against Trump's TikTok sale push & 'key money' demand
As President Trump continues to call for the sale of TikTok with a percentage of the sale going to the US Treasury, experts and Chinese government-controlled media are weighing in on the dangerous implications of such a deal.
On Friday, Trump had declared that he would soon be banning controversial short-form video app TikTok, claiming that the China-owned company posed a threat to national security. On Monday, he clarified that the company could continue to operate in the U.S. if they sold their U.S. arm to an American-owned company. He also stated that he believed a significant portion of the money from the sale should go to the U.S. Treasury.
When later asked whether the money should come from Microsoft or TikTok's parent company, the China-owned ByteDance, he said the U.S. should receive a significant portion of the deal regardless of who paid the fee.
"It's a little bit like the landlord/tenant; without a lease the tenant has nothing, so they pay what's called key money,' or they pay something," Trump said. "But the United States should be reimbursed or should be paid a substantial amount of money, because without the United States they don't have anything, at least having to do with the 30%."
As CNN and other venues point out, Trump's "deal" has no basis in antitrust law. Several experts have compared the deal to mafia racketeering.
"This is quite unusual, this is out of the norm," former chief counsel for the U.S. Department of Justice's Antitrust Division Gene Kimmelman said. "It's actually quite hard to understand what the president is actually talking about here. ... It's not unheard of for transactions to have broader geopolitical implications between countries, but it's quite remarkable to think about some kind of money being on the table in connection with a transaction."
Experts point out that this does not solve alleged security issues, but continues to exacerbate ongoing problems.
"...I think this is part of the splintering of the Internet into competing national networks," Mark Lemley, director of Stanford University's program in law, science, and technology, said. "I think that's a problem, and splitting TikTok into different national entities ... is only going to make that problem worse."
TikTok has gone on record stating that they remain committed to their American user base.
"TikTok is loved by 100 million Americans because it is a home for entertainment, self-expression, and connection," company spokesperson Josh Gartner said. "TikTok will be here for many years to come."
China, however, seems less willing to work with the U.S. government. The China Daily newspaper ran an article stating that it will not accept President Trump's bullying, according to Reuters.
While Microsoft continues to pursue an acquisition deal for TikTok, ByteDance has started brainstorming other solutions. The company has begun looking for a new headquarters, outside of both China and the U.S.
"In light of the current situation, ByteDance has been evaluating the possibility of establishing TikTok's headquarters outside of the U.S., to better serve our global users," the company said.
TikTok has been under fire recently for "clipboard snooping" after an iOS 14 beta feature uncovered how frequently the app was accessing a users clipboard.
On Friday, Trump had declared that he would soon be banning controversial short-form video app TikTok, claiming that the China-owned company posed a threat to national security. On Monday, he clarified that the company could continue to operate in the U.S. if they sold their U.S. arm to an American-owned company. He also stated that he believed a significant portion of the money from the sale should go to the U.S. Treasury.
When later asked whether the money should come from Microsoft or TikTok's parent company, the China-owned ByteDance, he said the U.S. should receive a significant portion of the deal regardless of who paid the fee.
"It's a little bit like the landlord/tenant; without a lease the tenant has nothing, so they pay what's called key money,' or they pay something," Trump said. "But the United States should be reimbursed or should be paid a substantial amount of money, because without the United States they don't have anything, at least having to do with the 30%."
As CNN and other venues point out, Trump's "deal" has no basis in antitrust law. Several experts have compared the deal to mafia racketeering.
"This is quite unusual, this is out of the norm," former chief counsel for the U.S. Department of Justice's Antitrust Division Gene Kimmelman said. "It's actually quite hard to understand what the president is actually talking about here. ... It's not unheard of for transactions to have broader geopolitical implications between countries, but it's quite remarkable to think about some kind of money being on the table in connection with a transaction."
Experts point out that this does not solve alleged security issues, but continues to exacerbate ongoing problems.
"...I think this is part of the splintering of the Internet into competing national networks," Mark Lemley, director of Stanford University's program in law, science, and technology, said. "I think that's a problem, and splitting TikTok into different national entities ... is only going to make that problem worse."
TikTok has gone on record stating that they remain committed to their American user base.
"TikTok is loved by 100 million Americans because it is a home for entertainment, self-expression, and connection," company spokesperson Josh Gartner said. "TikTok will be here for many years to come."
China, however, seems less willing to work with the U.S. government. The China Daily newspaper ran an article stating that it will not accept President Trump's bullying, according to Reuters.
While Microsoft continues to pursue an acquisition deal for TikTok, ByteDance has started brainstorming other solutions. The company has begun looking for a new headquarters, outside of both China and the U.S.
"In light of the current situation, ByteDance has been evaluating the possibility of establishing TikTok's headquarters outside of the U.S., to better serve our global users," the company said.
TikTok has been under fire recently for "clipboard snooping" after an iOS 14 beta feature uncovered how frequently the app was accessing a users clipboard.
Comments
"Why Trump dislikes TikTok
Analysis by James Clayton, BBC North America technology correspondent
Trump's dislike of TikTok goes further than just privacy concerns.
In India TikTok was banned after a border skirmish with China - it was caught up in a geopolitical feud. And that's what's happened here, too. Trump's sights are set firmly on China - and this should be seen through that lens.
TikTok says that it doesn't keep any data in China and would never give it to China.
But, in many ways it doesn't matter what they say, the fact that they are owned by a Chinese's company is guilt enough.
Not to be overlooked either is Trump's previous experience with TikTok.
Last month users claimed to have scuppered his Tulsa rally after signing up to tickets they had no intention of using.
And although there are Republican and conservative voices on TikTok, the profile of users in the US is generally young and liberal/left.
It's hard to believe that's not a factor here."
Even if they moved their 'headquarters' outside of China, the Chinese government would still maintain some influence over the platform.
This news is pretty odd. If someone has a better handle on this, please do explain.
Evidence. Accusation. Resolution.
Unfortunately, the US now has a reputation for ignoring the first point.
This is just another piece in the US-China fight for influence.
BAHAHAHAHAHAHAH!
The latter is absurd and hurts the standing of the US in the world marketplace. If any other country tried to do something like this they would be universally criticized and ridiculed.
https://om.co/2020/08/03/microsofts-tiktok-but-why/
"Why not someone like Disney which has dreams of being part of the digital revolution? Disney has the audience. It has sprawling global operations. It has the ability to walk the middle of the road where it can appease the autocratic governments and make the democratic countries satisfied. It also has a brand that has many sub-brands that cross many demographic categories. Disney wanted to buy Twitter. TikTok makes more of a strategic fit."
"Hence my question, why Microsoft?
I ask these questions but can’t help myself and not think about the event of last week?
And that does make me wonder? Does Microsoft have some sort of a quid-pro-quo in place with the US Government that makes them the most preferred nation when it comes to buying this company?"
https://500ish.com/tiktok-and-microsofts-clock-c4c9fd082b89
"Just read the thing. It’s almost like a letter of fealty. It reads like something a Chinese company might write under the Chinese government. To that end, it reads as if it was written at the behest of the government. Maybe that’s too strong. Maybe? How about: “Hey Satya, great conversation today. It sure would be nice if you could outline what we discussed publicly.” That kind of thing.
This is an actual paragraph in the post. The second paragraph, no less. What on Earth?! Is Treasury getting a finder’s fee here? The next paragraph:
That is… a very specific date? That is… a very specific third reference to the President? In three paragraphs. Wink. Wink."
Frankly, it all stinks, and for the record, I don't trust the Chinese Government at all, nor any Chinese Companies, with my data, assuming that we even know where our data is going.
Right after I posted, AI Posted this new link;
https://appleinsider.com/articles/20/08/04/apple-allegedly-in-the-running-to-buy-tiktok
So much for the higher standard of free markets and democracy. Thanks Trump!
Fast forward 20 years and here we are. When the leaders and societal bureaucrats should have been holding multilateral discussions and putting working groups together with techies at their beck and call to help them come up with workable solutions that more than one nation could get behind, they instead ignored the elephant and just kept chugging along in blissful ignorance. You know, like the elephant would magically go away once the weather warmed up or we put a curtain of denial around it so we could ignore its presence. Of course it didn't go anywhere, we could still see it and smell it through the curtain.
The current posturing and temper tantrums around this topic are just noise and bluster with little more substance than a mud wrestling contest. For technologists it should serve as a reminder that they often create tools and toys that can turn into weapons in the hands of despots, politicians, and posers if they don't figure out what to do about the system level and multidisciplinary impacts of what they create. Declaring that something is "done" or "done done" for you Scrum aficionados, when the known human, societal, and political ramifications of the technology have not been addressed is simply delaying the inevitable. Those elephants in the room don't go anywhere without proper handling, and while they are there they are creating a huge dung pile that somebody, maybe you or your successor, is going to have to grab a shovel and wheelbarrow and remove the pile and its source. Simply slinging the dung around or wrestling in the dung, which is exactly what is happening now around TikTok, isn't going to solve the problem. As long as the elephant is still there, there will be more dung to come.
I’d sure as f*** not want to live in your world.
I mean the hypocrisy is funny when the shoe is on the other foot.
Also "Me hate Trump so everything Trump does me hate!"
This is why I'm Independent. I get to enjoy the shi*show.