The Chinese parent of TikTok faces a growing backlog at home, comparing the company’s problems as the Trump administration increases pressure on the hugely popular social media app.
President Donald Trump on Friday issued an executive order requiring byteDance to complete a sale of TikTok’s US operation within 90 days. The company is in talks with Microsoft about a deal.
That has caused anger among users and observers in China that the Internet group will bow to American pressure in a time of growing tensions between Washington and Beijing.
“ByteDance will never be able to stand up again immediately after bending the knee” to the US government, wrote one user on the Twitter-like Weibo service of China. “We have no sympathy for cowards.”
Analysts said the U.S. government’s demand had put ByteDance in an awkward position because it was trying to negotiate a deal for its U.S. company without alienating its audience in China. Douyin – the TikTok brand name in China – had active users through July 6 through July, up from 20m three years ago.
“ByteDance still makes China happy in the US,” said a Beijing executive at a rival Internet company. ByteDance “runs the risk of selling TikTok and losing popularity in its home country”.
ByteDance – based in Beijing, has struggled to adapt its business model to international markets as it has expanded beyond China.
Like many private Chinese companies, ByteDance has a Communist Party committee headed by an executive who is responsible for ensuring that all text and video content conforms to restrictions imposed by the party, such as avoiding politically sensitive topics. It has an army of censorship in service that helps in filtering content that is considered taboo.
But TikTok, which includes ByteDance’s operations outside China, is given much more autonomy and is largely carried out by non-Chinese personnel. In May, TikTok appointed former Disney executor Kevin Mayer as its chief executive. The app also prevents mainland China users from accessing its content, which is not polished to the same level as in China.
ByteDance has fallen sharply in Beijing in the past. It shuts down its popular Neihan Duanzi app in 2018 after vulgar jokes and videos on the platform Chinese regulators were dissatisfied with.
Analysts said ByteDance’s announcement last week that it could legally challenge a separate executive order from the Trump administration was intended in part to show the Chinese public that it was fighting American action. The company has said it wants to ensure that “the rule of law is not disregarded” and its users are “treated fairly”.
But “the threat of legal action suggests that ByteDance leadership is panicking,” said Zhuang Bo, an analyst at TS Lombard.
Other commentators, however, noted that ByteDance probably has a few options but selling their business saw the pressure level exerted by Washington, which increases the possibility of further backlog in China.
“Selling Tiktok’s US operation at a reasonable price is the only choice for ByteDance,” Zhu Ning, a professor at the Shanghai Advanced Institute of Finance, wrote in an article posted online last week.
