TikTok holds its End Of 12 months Event 2022 in Milan, Italy, on Dec. 13.
Claudio Lavenia | Getty Images Entertainment | Getty Images
TikTok is starting to feel the sting of political and regulatory pressure in Europe, where the Chinese-owned app has largely evaded the scrutiny it’s faced within the U.S.
EU Commissioner of the Internal Market Thierry Breton warned TikTok CEO Shou Zi Chew in a gathering this month the bloc could ban the app if it didn’t comply with latest rules on digital content well ahead of a Sep. 1 deadline.
That is a marked shift from the EU’s near silence on TikTok, while U.S. lawmakers have been aggressive — banning the app from federal devices in December over national security concerns. A proposed bipartisan bill also seeks to dam the app from operating within the U.S.
It is not that the EU is soft on tech. Europe has fined U.S. tech giants for violating the EU’s General Data Protection Regulation.
The difference with TikTok is that the app has kept out of the crosshairs of business interests in Europe.
“There isn’t any political demand for investigation into Chinese entities,” Hosuk Lee-Makiyama, the director of think tank the European Centre for International Political Economy, said in an interview in December.
“The user base of TikTok is loads greater than a whole lot of people in Europe think,” he said. But, he added, “you are not going to look very closely in the event that they don’t steal an excessive amount of out of your ad revenue.”
TikTok had about 275 million monthly energetic users in Europe as of December, based on Sensor Tower’s Abe Yousef, noting that is a couple of third of Europe’s population of about 750 million.
The info dragon TikTok should be placed under the surveillance of the European authorities. Europe must finally get up.
Moritz Korner
MEP, European Parliament
TikTok was the most-downloaded social media app last 12 months in Italy and Spain, based on data.ai, formerly called App Annie. The app held second place in France and Germany, the info showed.
WhatsApp, owned by Facebook parent Meta, ranked first amongst social media app downloads in France and Germany, and third in Italy and Spain, based on data.ai.
Meta reported $29.06 billion in European revenue in 2021, a region the corporate defined as including Russia and Turkey. In contrast, TikTok recorded turnover of just $531 million within the European Union in 2021, based on the most recent available filing within the U.K. But that was well over 4 times what was disclosed for 2020.
“It takes a bit of little bit of time for the European Commission to get its act together on these issues,” said Dexter Thillien, lead tech and telecoms analyst at The Economist Intelligence Unit.
“It is not due to a scarcity of willingness from the European Commission to do something,” Thillien told CNBC in a phone interview. “They have their hands full with greater firms.”
TikTok is not yet a behemoth at the dimensions of firms like Meta, Alphabet and Amazon in the case of social media, promoting and e-commerce. But TikTok has turn into so popular that its app has inspired copycat products, comparable to Meta’s Reels short video feature.
Greater than half of individuals aged 16 to 24 in France and Germany use TikTok, based on data.ai.
Since its launch in 2016, TikTok has amassed a worldwide monthly user base of greater than 1 billion, and cemented the careers of well-known media personalities, from the D’Amelio sisters to Addison Rae.
That offers it a lovely pool of knowledge to coach its algorithms to focus on users aggressively with content most aligned with their interests. TikTok’s parent, Beijing-based ByteDance, has found similar success in China with an area version of the app, called Douyin.
A giant fear amongst U.S. intelligence officials — and increasingly lawmakers in Europe, as well — is that Beijing could influence how TikTok targets its users to interact in propaganda or censorship.
“TikTok’s success is the results of a European policy failure,” Moritz Korner, a member of the European Parliament for Germany’s Free Democratic Party, told CNBC via email.
“From a geopolitical perspective, the EU’s inactivity towards TikTok has been naive.”
Korner has been calling on the European Commission to pressure data protection authorities into taking motion against TikTok since 2019. He’s anxious the platform poses “several unacceptable risks for European users,” including “data access by Chinese authorities, censorship, [and] tracking of journalists.”
“The info dragon TikTok should be placed under the surveillance of the European authorities,” said Korner. “Europe must finally get up.”
Why Europe’s tone is changing
Last month, ByteDance admitted to using two journalists’ TikTok data to locate their physical movements, based on an internal memo. TikTok distanced itself from the activity, and said the workers involved were not employed at ByteDance.
Surveillance concerns, along with the EU’s tough Digital Services Act, were a giant topic of conversation in Chew’s meetings with EU officials earlier this month.
The DSA, which was approved last 12 months, is yet to be applied in Europe. EU officials are pressuring tech giants of all stripes to get their houses so as before a Sep. 1 deadline, including TikTok.
“The EU takes privacy and data protection issues very seriously. And it’s constructing one of the rigorous regulatory architectures for digital platforms, including TikTok, on the planet,” Manuel Muniz, provost at IE University, told CNBC.
Under Chinese counter-espionage and national security rules, TikTok’s parent company ByteDance and other Chinese tech firms can be forced to share user data with Beijing if asked to by the federal government, experts previously told CNBC.
This was a priority back when the U.S. was pressuring allies to ban Huawei, the Chinese telecommunications giant, in 2019. Addressing the National Intelligence Law in a 2019 press conference, a Chinese government spokesperson said intelligence work needs to be done “based on law” and urged people to “not take anything out of context.”
China’s Ministry of Foreign Affairs didn’t immediately reply to a request for comment.
TikTok has admitted that data on its European users could be accessed by employees based in China, but denies it will ever share such information with the Chinese government. An organization spokesperson told CNBC the firm has “all the time been certain by and strived to comply with EU regulations that apply to us.”
“We’re continuing to foster a robust culture of compliance by investing heavily in evolving our platform and business to align with the changing regulatory framework,” the spokesperson said.
The firm nonetheless says it’s committed to creating a strong system for processing the info of Europeans inside Europe. This can include establishing a latest data center in Ireland to accommodate European users’ data locally.
That reflects a significant difference: European regulators have focused on data processing, while U.S. regulators search for national security threats.
Meanwhile, investigations into TikTok’s accessing of users’ data in China are “beginning to bear fruit,” based on Thillien.
Investigations take time. The Irish Data Protection Commission took nearly five years to finish its probe into Meta’s targeted promoting practices, which resulted in a fantastic of greater than $400 million.
The commission is examining whether the transfer of user data from TikTok to China and processing of knowledge on minors is in breach of the bloc’s strict GDPR privacy rules. An consequence within the Irish privacy probe is not expected until late this 12 months or 2024.