For the first time, a genuine Chinese app — not a knockoff of something invented in the United States or Europe — captured the hearts of American teenagers and millennials. On one level, it was harmless: TikTok is mostly jammed with one-minute dance videos. By many measures, it was a bigger parenting problem than a national security problem. Whatever it was, it clearly wasn’t on Washington’s radar the way that the expansion of China’s nuclear arsenal, or its actions in the South China Sea, dominate the China debate.
Yet as Brad Smith, the president of Microsoft, which competed with Oracle to buy TikTok’s operations in the United States, noted, “there is a potential threat.” To make TikTok tick, the company collects vast amounts of data on Americans’ viewing habits. And the same algorithm that picks your next dance video could, in the future, pick a political video. (There is already more than a whiff of political content on the app.)
Like Oracle, Microsoft would have taken over the storage of all data on Americans, keeping it in the United States. (TikTok currently has a major data server in Virginia, but backs up data in Singapore.) But Microsoft’s bid went further: It would have owned the source code and algorithms from the first day of the acquisition, and over the course of a year moved their development entirely to the United States, with engineers vetted for “insider threats.”
So far, at least, Oracle has not declared how it would handle that issue. Nor did President Trump in his announcement of the deal. Until they do, it will be impossible to know if Mr. Trump has achieved his objective: preventing Chinese engineers, perhaps under the influence of the state, from manipulating the code in ways that could censor, or manipulate, what American users see.
“If Oracle is providing hosting with the majority of engineering and operations staying with ByteDance, then the only effect of this deal was to swing billions of dollars of cloud revenue,” said Alex Stamos, who runs the Stanford Internet Observatory. “The details of the deal will really matter, and so far the public has not been provided with enough information to have an educated opinion.”
Without that issue resolved, it is unclear how Mr. Trump could declare that the security issues are solved, much less how he could say that the new entity “will have nothing to do with China.”
The longer-run issue, however, is that there will be more TikToks, companies around the world that develop apps that Americans love — or see as a hedge against their own government. Already, many Americans use encryption apps, like Telegram, that are based outside the United States, so that the United States would have a more difficult time issuing subpoenas for the content. Attorney General William P. Barr has already called for greater scrutiny — and perhaps abolition — of any such app that does not allow the United States a legal “back door.”