It needs the combined forces of big tech and Donald Trump to produce hypocrisy of the magnitude surrounding the forced sale TikTok — or, as it should be more accurately described, the extortion of Chinese company ByteDance.
We’re all supposed to hate the Chinese tyranny and the tech companies it can use to serve its purposes of surveillance, control and commercial espionage, both at home and abroad.
But the Five Eyes governments of the US, UK, Canada, Australia and New Zealand are no better when it comes to surveillance and commercial espionage — and control, when they want it. Indeed, we invented the practice of hoovering up personal data from tech platforms — and Western companies invented the practice of monetising that data.
Perhaps that’s why no one seems perturbed that the Trump administration intends to prise the boom social media app TikTok from the ownership of Chinese company, ByteDance.
Bytedance identified an opportunity in — or perhaps created, or both — young people’s interest in mobile short videos. Anyone over 25 either never heard of TikTok or would be completely bewildered by what its users see in it. It’s a classic case of innovation driven by connectedness, which left Western tech giants miles behind.
Now, on the pretext TikTok is a security threat due to its vacuuming up of personal data — the very business model of Facebook and Google — the Trump administration is going to ban it, forcing a sale to Western interests. Microsoft has put its hand up to acquire TikTok in the US, Canada, Australia and New Zealand. Trump has set a deadline of September 15 for a deal to be done. There will be a lot of haggling over the price, but Microsoft had US$136 billion in cash at the end of June.
Microsoft’s acquisition might be at the exact moment TikTok loses its lustre — or one may cause the other. Either way, the acquisition has all the characteristics of News Corp’s 2005 acquisition of MySpace.
But once it is controlled by Microsoft, it means that the NSA, the Australian Signals Directorate and other Five Eyes governments will be able to use the app to vacuum up user data. And, as the Snowden revelations demonstrated over and over again, that’s exactly what our governments do.
Indeed, the Australian government, in last week’s melodramatic cybersecurity strategy, boasted of its ability to thwart encryption on widely used apps and devices.
The main use of such information is allegedly to fight terrorism, child abuse and organised crime. In reality it’s commercial espionage and pursuing whistleblowers, journalists, lawyers and anyone else who embarrasses governments.
But that’s only the start of the hypocrisy.
For the last couple of years, pretty much everyone has been railing about big tech and the need to impose limits on the monopolistic practices of Facebook, Amazon, Alphabet (owners of Google) and Apple. Microsoft, of course, was being pursued by competition regulators before Facebook and Amazon even existed. It’s been one of the few causes to bring politicians together in this polarised political age.
Now Trump and the US Congress are now willing to anoint them as the national champion to grab control of the major foreign threat to big tech.
The mainstream media, eviscerated by Facebook and Google, have cheered on attempts to rein in big tech. Here, News Corp essentially dictated to the Morrison government how it should force Google and Facebook to hand over hundreds of millions of dollars allegedly for use of content. So all the more curious that the crushing of a competitor to big tech not merely in the US and Canada but here as well has been greeted with such equanimity, especially at the Financial Review, which normally adopts a “forget China’s monstrous crimes, just think about the money to be made” editorial line.
The United States likes to impose Investor State Dispute Settlement (ISDS) provisions in trade deals on smaller countries, ostensibly because the legal systems of smaller countries can’t be trusted to protect investment by US firms. But it’s unlikely any dispute that ended up before a dodgy international ISDS forum has ever been remotely the size of what will be a forced acquisition of TikTok.
Trump has also, Mafia-style, insisted that the US government receive a large slice of any deal. This may well be unconstitutional. One lawyer described it as “akin to the Foreign Corrupt Practices Act but on US soil, where the US government would be able to require what is tantamount to a bribe in order to obtain a regulatory approval for a business transaction”.
Imagine the outrage if the Chinese government demands that the Chinese operations of Microsoft be ceded to a local government after any TikTok deal was completed — and takes a juicy cut of the proceeds. It would confirm what everyone has been saying about the lack of any rule of law there, and rightly so.