TikTok’s ‘secret sauce’ in US-China tussle

AS A US campaign to sever TikTok from its Chinese parent heads to the Senate, analysts say Beijing’s response to a forced sale of the app – and its “secret sauce” algorithm – will be clear: hands off.

Under new legislation that passed in the House of Representatives last week, TikTok could be banned in the US if it does not cut all ties with Chinese tech giant ByteDance.

But in the battle over TikTok’s future in the US, what strikes many as a contradiction has emerged: while the company tries to convince Congress of its independence from Beijing, China has come out swinging in its defence.

Beijing does not want a precedent to be set where a Chinese company is strong-armed into selling one of its most valuable assets, including an algorithm that is the envy of competitors, analysts say.

“This kind of threat is like daylight robbery,” said Mei Xinyu, a Beijing-based economist.

“All things considered, the Chinese government’s actions so far have been very mild.

“What the US government is proposing is way over the line.”

US lawmakers and security agencies say TikTok presents a threat because China can access and use the vast troves of data the app collects for influence and espionage.

TikTok has denied the allegations, saying it has spent around $1.5 billion (about R28bn) on “Project Texas”, under which US user data would be stored in the US.

However, many lawmakers and bodies, including the FBI, remain unconvinced.

Some critics have said the data itself is only part of the issue, and that the algorithm that produces personalised recommendations for TikTok users must also be disconnected from ByteDance.

That ByteDance algorithm has helped drive TikTok’s stratospheric success since the app was launched for the international market in 2017.

It crunches huge amounts of user data, such as their interactions on the app and their location, to provide more content tailored for them.

Its precise details are a closely guarded secret, but it helped propel TikTok to 1 billion users in just four years. Facebook, by comparison, took more than eight years to reach that milestone.

Other social media platforms also deploy tailored recommendations based on algorithms that analyse user data, but analysts say TikTok has been so successful that it is considered by some to be the company’s most precious asset.

The algorithm is “valuable because TikTok is sticky. People spend more time on TikTok than they do on other social media”, James Andrew Lewis, a technology expert at the Center for Strategic and International Studies, told AFP.

“This is the secret sauce that makes TikTok a success.”

The algorithm has been at the centre of discussions about any potential sale of TikTok since the administration of then US president Donald Trump sought to ban TikTok in 2020.