While TikTok faces uncertainty abroad, its twin, Douyin, booms at home

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Singapore: As the Australian government was busy banning TikTok from all government devices this week, the Chinese social media app’s parent company was busy collecting money.

A man walks past a display for Douyin, the Chinese version of video-sharing app TikTok.Credit: AP

ByteDance’s revenue surged more than 30 per cent to more than $US80 billion ($118 billion) in 2022, according to an investor memo seen by Bloomberg.

The galloping expansion has not just been driven by TikTok, but also by its Chinese equivalent, Douyin, which is now diversifying into food delivery, e-commerce and ride-hailing services, and taking on the might of other local tech giants Tencent and Alibaba.

Douyin, which looks and feels like TikTok but is restricted by Chinese government regulations, has seen its popularity boom to more than 600 million daily active users. It has not just complied but thrived under Beijing’s censorship regime − an environment in which executives such as Alibaba chief Jack Ma have disappeared for months for not toeing the Communist Party line.

ByteDance learnt that lesson early after “vulgar content” was posted on one of its platforms in 2018.

“Our product took the wrong path, and content appeared that was incommensurate with socialist core values,” ByteDance founder Zhang Yiming said before pledging to “further deepen cooperation with authoritative media, elevating distribution of authoritative media content, ensuring that authoritative [party] media voices are broadcast to strength.”

Since then, TikTok’s parent company has largely been spared the tech crackdowns that have hit Alibaba and Tencent. In 2021, the government acquired a 1 per cent stake and one of three seats on its board.

For Douyin, business in China has boomed as a whole generation of video streamers push their products on the platform. The $148 billion market has become so lucrative for brands and influencers that Chinese video producers have taken to streaming content from underneath bridges in wealthy suburbs to game the geography-driven algorithm and boost their sales of make-up, gadgets or clothes.

Zhang Yiming, chief executive officer and founder of ByteDance, in Beijing in 2019.Credit: Bloomberg

Likewise, millions of TikTok’s loyal young users in Australia, Europe and the United States have remained blissfully unaware of the geopolitical fight over technology that is engulfing their favourite platform.

The company now faces the climax of its decade-long journey to domestic and global dominance: the clash of Chinese regulation and its international ambitions. Washington, Canberra, London, Brussels and Ottawa have all raised security concerns over the level of data it collects and its ties to the Chinese government, which they argue could force the company to hand over personal data if required.

TikTok has repeatedly denied it would comply with such a request, but that has not been enough to convince regulators who can point to laws passed by Beijing in 2014 and 2017 that stipulate any Chinese organisation must assist or cooperate with state intelligence work and “relevant organisations … may not refuse” to collect evidence for an investigation.

The Biden administration in March threatened to extend its TikTok ban to all devices in the US unless ByteDance divests its stake and places the video-sharing app into a US-based company. A US ban would leave all of TikTok’s global operations vulnerable while accelerating the bifurcation of technology into Chinese and Western spheres.

“I think fundamentally it is an issue of trust,” says Dr Benjamin Ho of Nanyang Technological University. “If it was about something smaller, like fashion, I don’t think anyone would care. But because it is about technology and the United States and China, trust is the defining factor.”

Democrat Jamaal Bowman joins a pro-TikTok rally in Washington last month.Credit: AP

The TikTok dispute neatly fits into domestic political agendas for both sides.

“There are deep disagreements as to what the US national interests are and what US American identity is but one thing they can all agree on is that China is a threat,” says Ho. “And vice-versa [China has its] own domestic problems that are being blamed on the United States. They need to find an external threat to validate what they do internally.”

Last week on TikTok some of the most popular videos included pouring salt into an office water cooler, a green tree snake running down Robert Irwin’s face and a late-night fridge raid that involved Peking duck, an air fryer and scones.

On Douyin, a cat gave a passerby a high-five, some college students morphed seamlessly from cramming study to stuffing their faces with food, and others used their phones as strobe lights to transform dorms into dance studios.

Any one of the videos could have appeared in the Chinese or Western sphere and few would have noticed. But the universal, inane and whimsical content has never been so divided by national security, politics and the domestic interests of its leaders.

“Proponents of globalisation always say that if we all globalise, we can get along fairly well,” says Ho. “Right now what we’re seeing is the backlash. Globalisation has its limits when confronted with nationalism.”

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