Inside Business

Trump’s latest demands in the TikTok saga reek of corporate gangsterism

The president has made the Chinese-owned app an offer it can’t refuse – and the implications are deeply troubling, writes James Moore

Tuesday 04 August 2020 22:35 BST
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The US leader meets American tech workers this week
The US leader meets American tech workers this week (Getty)

If the clock is tick tock-ing down to the end of the Trump presidency, the Donald nonetheless seems determined to prove that he can still throw a lot of rocks, cause a lot of trouble and break a lot of things, including rule books.

This brings us neatly to TikTok, the short-form video app that’s at the centre of a very big fuss. Here’s the short-form explanation for that if, like me, you were born before the millennium: it’s wildly popular, has rapidly acquired a huge and youthful user base, and it’s owned by a company called ByteDance, which is based in China.

The Trump administration has said it is concerned that the app could put Americans’ private information in the hands of the Chinese Communist Party (CCP) and has signalled an intention to move against it by means of a ban. It’s worth pointing out that India, which is embroiled in its own spat with China, has already instituted one of these. A deadline of 15 September has been set by the Trump administration for the US to follow suit.

Quite what value the CCP would see in the data of ordinary Americans who pass their time lip syncing or posting videos of cats chasing spotlights is open to some question, but let’s not let that get in the way of a geopolitical pissing contest.

Given the blow a US ban would deal to TikTok, talks are underway about a sale to Microsoft.

While no one’s explained quite how you’d cut the US part of it out, you can see the appeal on both sides. ByteDance gets some value out of a business it otherwise faced losing, even if it has to sell up cheap by dint of being a forced seller. Microsoft gets its hands on a potential pot of gold for a reduced purchase price.

Now here’s where it starts to get really sticky. “The US should get a very large percentage of that price, because we’re making it possible,” Trump declared during a press conference earlier this week.

An official Microsoft blogpost followed, which said that the company “is committed to acquiring TikTok subject to a complete security review and providing proper economic benefits to the United States, including the United States Treasury”.

The blogpost was issued “following a conversation between Microsoft CEO Satya Nadella and President Donald J Trump”.

This reeks of corporate gangsterism on a grand scale.

It’s one thing for a government to force a business out if it has concerns about what it’s doing, quite another to call for a hefty commission for delivering it into the hands of the home team.

If you were being charitable, you could make a case that this is an all too rare occasion of a tech company pledging to make contribution to an exchequer, given the complicated, and cynical, means they normally use to avoid paying any tax at all.

But the way this is playing out is deeply troubling. Regardless of the debate around TikTok, and its data policies, and the fact that plenty of American tech companies have questions to answer when it comes to data and privacy, if this is allowed to happen once, it will happen again.

Because of that, it should be recognised that the price is too high, however attractive TikTok USA might seem.

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