How a TikTok ban in the U.S. might work

The TikTok logo is displayed outside the offices of the social media app company TikTok on March 16, 2023 in Culver City, California.

Patrick T. Fallon | AFP | Getty Images

is on TikTok. Risk of being banned In the U.S., if Chinese parent ByteDance won’t sell its stake. Millions of Americans who use the popular video app are wondering what this means for them.

Some fans of the service can turn to virtual private networks (VPNs) and try to connect to TikTok if blocked, a solution that makes it look like their internet connection is coming from another country. . But exploiting this flaw may not be so easy.

Related investment news

CNBC Investing Club

This is not a problem yet, as there are still some ways to avoid the ban on TikTok in the US or access it legally.

What a foreclosure or forced sale might look like.

The Committee on Foreign Investment in the United States (CFIUS) is an interagency body that reviews national security concerns surrounding the app to determine how to mitigate the risk if it continues to operate domestically. go The group can make a recommendation. President Joe Biden That ByteDance’s 2017 acquisition of, a TikTok forerunner, would make those assets unsecured, forcing them to sell them.

TikTok has recommended a divestiture plan as an alternative to forced sales. But this is a long-shot solution as CFIUS already is. Ban threatened If Byte Dance won’t sell its share.

A forced sale would be a complicated process, requiring years of unsecured transactions. The Trump administration has pursued this path once before to no avail. The Chinese government is likely. Oppose it Again, but he will need to be careful in his protests because the heart of his argument to the US is that TikTok operates independently.

“It will be part of the calculus and how aggressively China wants to respond,” he said Lindsay GormanA Senior Fellow for Emerging Technologies at the German Marshall Fund’s Alliance for Securing Democracy. Gormany previously served as a senior adviser in the Biden White House.

If the US bans TikTok, the mechanics of what happens from there are murky. Oracle Is Cloud hosting service US internet service providers such as for all TikTok use Comcast (parent company of NBC Universal) and Verizon Direct traffic to end users. And controlled by app stores. apple And Google These are the main places for users to download the TikTok app.

Shannon ReevesA partner in Strock’s CFIUS compliance group said no need for a third party would come from CFIUS, which is tasked only with reviewing foreign investments.

“This review will not result in any action being taken by CFIUS against third parties that are not parties to this transaction,” Reeves said. “So your Apples and your Googles, etc., that won’t happen.”

The government may have to resort to legislation or executive orders to get app distributors, ISPs and cloud services to block access to TikTok.

If TikTok is banned, it will have the biggest stock impact on Snap: LightShed's Rich Greenfield

While cracks are always likely to be cracked by a subset of computer literate users, the average user will find it difficult to access a government-restricted service. Douglas SchmidtProfessor of Engineering at Vanderbilt.

“There will always be ways around it,” Schmidt said. “It would be much more difficult for the average person to do without an advanced degree in computer security or something.”

In other words, a VPN wouldn’t be enough, in part because going that route would require App Store credentials, which would indicate the user’s location. Gerald Kasulis, a vice president at NordVPN, said technology is also available to detect when a user is trying to access an app with a VPN.

Security concerns

Concerns about TikTok’s security risks come down to two main issues. The first is who can access US consumer information and the second is who has the ability to determine what information reaches US consumers. Companies may be governed by Chinese law. Internal information is required to be turned over to the government for national security purposes..

TikTok has tried to assure the US government that US user data is safe outside of China. The company has developed an extensive plan known as Project Texas that includes testing its code in the US and a separate board of directors for its domestic subsidiary, whose members are vetted by the US government. .

TikTok CEO Xu Zhiqiu, who is set to testify before a US House panel next week, said: The Wall Street Journal That Project Texas will do as much to address any safety concerns as distribution.

But the mood in Washington is not growing in TikTok’s favor, and lawmakers have lost whatever faith they had in China and its intentions. The issue resurfaced earlier this year, when a suspected Chinese spy balloon was spotted flying over a large area of ​​the US Biden ordered the military. Shoot the balloon last month.

When it comes to consumer technology, consumers have no idea what information the Chinese government is getting. And the US government has a lot of work to do to clarify what will happen if the app is banned.

“Even for someone who studies this stuff, it’s not easy to separate and isolate all these apps,” Gorman said. “As a society, we haven’t decided that the app stores, the Apple App Store or the Google Play Store, should limit apps based on the amount of information they collect. That can’t be put on an individual. “Governments really need to pay attention to this.”

While many users might think their casual social media use would be of little interest to a foreign government, Schmidt said the data could have surprising value for bad actors.

“Having information about your habits and your interests and your interactions and where you go and what you do can be used for things like phishing attacks to gain access to more information, or blackmail. For things like, if you’re doing what you’re doing. Maybe other people don’t know about it,” Schmidt said.

This is unfamiliar territory for US companies, unlike China, which blocks access to all types of content, including the largest US internet services.

“Trying to access police data is very, very difficult, especially when it’s suspected that the people who are doing it have a reason to do it,” Schmidt said. “And they have a great incentive to collect that information and use it for all kinds of purposes.”

Subscribe to CNBC on YouTube.

WATCH: Uncertainty over Tik Tik’s fate sends competing stocks reeling

Uncertainty about TikTok's fate sends competing stocks soaring.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *