Is it a China-owned TikTok, or is it managed by a consortium of billionaires backed by Trump?
This is the question Australia is being prompted to contemplate.
The Trump administration stated that the agreement proposed by TikTok to continue its U.S. operations would involve Americans, transferring control to a U.S. firm with seven board members. Donald Trump has indicated that a group of U.S. companies, including Oracle’s Larry Ellison and Fox Corporation’s Rupert and Lachlan Murdoch, are part of this deal.
TikTok is owned by the Chinese entity ByteDance. In 2024, the U.S. Congress enacted a law to prohibit social media apps unless sold to a U.S. company, citing privacy and national security issues. The Trump administration has repeatedly extended this ban while negotiations continue between the U.S. and China.
According to White House press secretary Karolyn Leavitt, TikTok’s own algorithm will be “managed by the U.S.”
Liberal Senator James Patterson commented that Australia should transition to the U.S. version of the app as the deal advances.
“If there were a safe version of TikTok in the U.S., it would be unfortunate for the Australian version to remain under the control of foreign authoritarian governments,” he remarked to Murdoch. Sky News.
Tom Sulston, policy director for Digital Rights Watch, highlighted that the issue lies not in ownership, but rather in pervasive user surveillance, describing the transition to U.S. control of TikTok as “puzzling.”
“Ownership isn’t the main concern. The issue is the continuous invasive monitoring of users. U.S.-owned TikTok users do not enjoy greater privacy than those using the Chinese version, as there is a lack of effective regulation of social media firms,” he stated.
“TikTok users remain under extensive surveillance while online, which is utilized for profiling by both them and the National Information Services.”
Sky Predabeck, a fellow at the Australian Institute; emphasized the need for a Royal Commission and expressed her concerns about TikTok’s influence on media representation and public discourse.
“If the Murdochs own TikTok, this would give a new level of power over media, especially since TikTok plays a crucial role in public discussions and elections,” she explained.
Sulston argued that TikTok’s algorithm would likely remain just as opaque under U.S. control, as Meta and other platforms utilize their algorithms with almost no transparency.
“These companies depend on secret algorithms that exploit industrial-level surveillance of users to suggest content and advertisements.”
Dr. Dana McKay, Associate Dean of Interaction, Technology and Information at RMIT University, proposed that Australia should develop its own local version of TikTok for better data and security management.
However, McKay cautioned that ownership changes might lead to an app version that fails to meet user expectations. The core appeal of TikTok is its algorithm, and there is uncertainty about whether the data used for recommendations would be transferred to the U.S. during the transaction.
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“Currently, Oracle is in the process of reconstructing the algorithm, but there may be a significant drop in user experience until sufficient data is gathered on viewing habits,” McKay added. “This could take days or weeks, depending on how much data the existing algorithm relies on.”
Will this deter users or drive them to another application? Sulston referenced News Corp’s previous unsuccessful venture into social media with MySpace.
In 2005, News Corp invested USD 580 million during a boom in online social networking. MySpace was valued at USD 12 billion at its peak, but then Facebook emerged, offering better navigation and features.
By June 2008, Australians were visiting Facebook more than MySpace, a trend that didn’t occur in the U.S. until 2009.
Frustrated, Rupert Murdoch sold MySpace in 2011 for USD 35 million.
“News Corp sold MySpace for significantly less than its original purchase of around USD 5 billion. Perhaps this will be another misstep,” Sulston noted.
The federal government maintains its stance on TikTok, which is banned on government devices, and indicates ongoing oversight of U.S. developments during the transaction process.
Both News Corp and TikTok were approached for comment.
Source: www.theguardian.com
