TikTok in Europe’s crosshairs as US considers banning Chinese-owned apps

TikTok is starting to feel the pain of political and regulatory pressure in Europe, where it largely sidestepped the scrutiny that China-owned apps face in the US.

EU Internal Market Commissioner Thierry Breton told TikTok CEO Shou Zi Chew at a meeting this month that if the app fails to comply with the new rules on digital content well before the Sept. 1 deadline, the app will block. warned that it could be banned.

It’s a notable change from the EU’s near-silence on TikTok, with US lawmakers aggressive, banning the app from federal devices in December over national security concerns.Proposed bipartisan bill also seeks to block apps from operating in the US

It’s not that the EU is technology-friendly. Europe has fined a US tech giant for violating the EU’s General Data Protection Regulation.

The difference with TikTok is that the app stays out of the crosshairs of commercial interests in Europe.

Hosuk Lee-Makiyama, head of the European Center for International Politics and Economics think tank, said in a December interview, “There is no political demand for an investigation into the Chinese organization.

“TikTok’s user base is much larger than many people in Europe think,” he said. No,” he added.

According to Sensor Tower’s Abe Yousef, TikTok had about 275 million monthly active users in Europe as of December, more than a third of Europe’s population of about 750 million. I point out.

According to data.ai (formerly App Annie), TikTok was the most downloaded social media app in Italy and Spain last year. According to the data, this app placed him second in France and Germany.

WhatsApp, which is owned by Facebook parent company Meta, ranked first in France and Germany and third in Italy and Spain in terms of social media app downloads, according to data.ai.

Meta reported 2021 European revenue of $29.06 billion. This is the region the company has defined as including Russia and Turkey. By contrast, according to the latest filings available in the UK, TikTok posted just $531 million in sales in the European Union in 2021, a figure that was disclosed in 2020. well over four times the

“It will take some time for the European Commission to take action on these issues,” said Dexter Tyrian, chief technology and communications analyst at the Economist Intelligence Unit.

“It’s not because the European Commission is unwilling to do something. They have their hands full with bigger companies,” Thirien said in a telephone interview with CNBC.

TikTok is still not huge on the scale of companies such as meta, alphabet When Amazon When it comes to social media, advertising and e-commerce. However, TikTok has become so popular that the app has inspired similar products such as his Meta’s Reels short video feature.

According to data.ai, more than half of 16- to 24-year-olds in France and Germany use TikTok.

Since its launch in 2016, TikTok has amassed a monthly user base of over 1 billion worldwide and cemented the careers of notable media personalities, from the D’Amelio sisters to Addison Ray.

This gives us an engaging data pool to train algorithms to actively target users with content that best matches their interests.TikTok’s parent company, Beijing-based ByteDance, , has had similar success in China with a local version of the app called Douyin.

There is great concern among US intelligence officials and a growing number of European parliamentarians that Beijing could influence the way TikTok users get involved in propaganda and censorship.

“TikTok’s success is the result of European policy failures,” Moritz Korner, a member of the European Parliament for the German Liberal Democrats, told CNBC via email.

“From a geopolitical point of view, the EU’s indifference to TikTok was naive.”

Since 2019, Korner has asked the European Commission to pressure data protection authorities to take action against TikTok. Korner has said the platform has “protected data access, censorship, [and] Tracking journalists. ”

“Data Dragon’s TikTok should be under the scrutiny of European authorities,” said Korner. ‘Europe must finally wake up’

According to a widely reported internal memo, ByteDance admitted last month that it used TikTok data of two journalists to identify their body movements. Surveillance concerns, along with the EU’s tough digital services laws, were a big topic when Chu met with EU officials earlier this month.

The DSA, approved last year, has not yet been applied in Europe. EU officials are pressuring various tech giants to put their homes in order by his Sept. 1 deadline, including TikTok.

“The EU takes privacy and data protection issues very seriously, and has created one of the strictest regulatory architectures in the world for digital platforms, including TikTok,” said IE University’s President Manuel Muniz told CNBC.

Under China’s counter-espionage and national security regulations, TikTok’s parent company ByteDance and other Chinese tech companies would be forced to share user data with Beijing if asked by the government. , an expert previously told CNBC.

This was a concern when the US pressured its allies to ban Chinese telecoms giant Huawei in 2019. It urged people to “don’t take anything out of context.”

China’s Ministry of Foreign Affairs did not immediately respond to a request for comment.

TikTok has confirmed that data about its European users can be accessed by employees based in China, but denies it will ever share such information with the Chinese government.

Nevertheless, the company says it is working to create a robust system for processing data on Europeans within Europe.

This reflects a big difference. European regulators focus on data processing, while US regulators look for national security threats.

Meanwhile, investigations into TikTok’s access to user data in China are “starting to bear fruit,” Thillien said.

Investigation takes time. The Irish Data Protection Commission took him nearly five years to close an investigation into Meta’s targeted advertising practices and fined him more than $400 million.

A commission is investigating whether the transfer of user data from TikTok to China and the processing of data of minors violates the block’s strict GDPR privacy rules. Not expected until late or 2024.