Even in an era of outsized corporate ambition, TikTok’s spectacular growth is the stuff of business dreams. From a standing start in 2017, the Chinese-owned video-sharing app declared 100 million European users within three years and claimed in 2021 to have reached more than one billion users around the world. Now the world’s fastest-growing social media company is hiring 1,000 people in Dublin, bringing the largest Irish workforce of any Chinese company to 3,000 this year.
The three-minute limit on TikTok viral dance videos, comedy skits and lip-sync routines has helped the company take advantage of a great paradox in the internet age: the longer people seem to spend online, the shorter their attention span as they are drawn from one distraction to another. TikTok will not publicly quantify how many Irish users it has, yet there are many, and the app is a huge hit with schoolchildren. In Ireland children are supposed to be 13 before they start using TikTok but many find ways of evading such strictures without parental supervision. The company’s speedy advance, and the growth of rival video platforms such as Facebook’s Instagram and Google’s YouTube, have prompted persistent pleas for stronger laws to protect children from harmful images.
“Children are now growing up in cyberspace,” says Irish cyberpsychologist Prof Mary Aiken of the University of East London, who was awarded the freedom of Dublin last Saturday for her work on online safety and security. “The regulation, governance and protection that we afford to people in the real world needs to be replicated online.” Citing research by consulting group Kepios, Prof Aiken says people worldwide spend an average of seven hours per day on internet devices. “Almost a third of our lives is being spent online.”
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For all its growing popularity, TikTok’s great leap forward has come at the cost of ever-increasing political and regulatory scrutiny. When he was still in the White House two years ago, president Donald Trump tried to ban TikTok from the US because of national security concerns about Chinese access to American users’ data. That did not happen. But TikTok, just like other popular online platforms used by children, still faces the intensive glare of critics who claim the app leaves vulnerable young users exposed to potentially harmful videos when they do not know how to spurn such content or control addictive screen dependence.
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Although Minister for Media Catherine Martin is advancing new online safety laws, Prof Aiken argues the draft legislation needs to be strengthened. “It’s not at a level where it will be robust or effective enough at this point to do what is required. It’s looking at a limited set of harms. There’s a much broader range of harms,” she says, citing the need to specifically confront issues around online sexualisation and grooming, misinformation as a harm and cyber fraud. Responding, Martin’s department says a new safety commissioner will devise “binding online safety codes” to tackle certain defined categories of harmful content.
Like certain rivals, TikTok is the subject of investigation by Irish data regulators into claims that its app violates children’s rights under stringent European data laws. It separately faces three Dutch class actions for alleged data breaches and has also become embroiled in rows over the posting of misinformation about Russia’s invasion of Ukraine.
Asked several questions about investigations and actions against TikTok, and whether the platform was safe for children, a company spokesman declined to discuss any specifically. “TikTok brings entertainment, joy and connection to our global community,” he says, adding that the company was proud to invest in Ireland. “The privacy and safety of our community is our priority, and we’re constantly enhancing and investing in the policies and technologies that help our users, particularly our younger teens, enjoy a safe and positive experience on TikTok.”
Critics may see little reason for joy in the proliferation of social media in childhood. But none of that deterred the Government from unfurling the red carpet for Tiktok in its quest for growth. When Taoiseach Micheál Martin and IDA Ireland chief Martin Shanahan this month met Tiktok’s youthful Singaporean chief executive Shouzi Chew, to sign off on the company’s Irish expansion, the welcome was warm. “TikTok’s latest expansion further embeds Ireland as an important hub for its European and global operations and is clear evidence of its commitment to this country,” Martin said.
TikTok’s Irish expansion reflects the strength of the Big Tech sector that has made Ireland the European launch pad for supersized US groups such as Apple, Google, Facebook, Amazon and Microsoft. The Chinese company is a relative newcomer to this milieu but its ascent has been extraordinary. It had 55 million users at the start of 2018 and saw that surge in 12 months to 271 million. That advanced to 508 million in 2019 and 689 million by mid-2020, the year before it hit the billion-user threshold.
The owner of TikTok is ByteDance of Beijing, a tech group that says its private investors include US funds Coatue, General Atlantic, KKR and Sequoia Capital, Chinese funds Hillhouse and SIG and Softbank of Japan. In engagements over three days this week, a senior Irish spokesman for TikTok declined to reply on the record to the question of whether the Chinese government, or any arm of the Chinese state, owns ByteDance shares or has board representatives. No information attributable to the company was provided on such questions, and others.
Security
TikTok arrived in Dublin in 2019, starting out with five workers and the next year recruiting more than 400 — even as coronavirus ripped through the country and the economy. The company’s advisers include law firm Arthur Cox, the IFSC arm of Citibank and auditor PricewaterhouseCoopers — groups which have deep and long-standing engagements with many large US group in Ireland.
Despite its Dublin location and Chinese ownership, TikTok’s Irish financial accounts are stated in US currency. If that implies efforts to achieve a certain proximity to US business standards, TikTok felt the full force of Trump’s wrath when he threatened to cut it loose on the basis that sensitive US user data could be retrieved and misused by the Chinese Communist Party government. In the endless White House psychodrama of that tumultuous time, the then president was constantly striking out at enemies perceived or real.
President Joe Biden revoked the proposed ban after he took power last year, replacing it with an order calling for a broader review of non-US apps that could pose a security risk. In March a coalition of eight attorneys general in US states said they were starting an inquiry into TikTok “for promoting its social media platform to children and young adults while its use is associated with physical and mental health harms to youth”. The office of California Attorney General Rob Bonta said he was “committed to holding social media companies accountable” particularly when their actions may cause harm to young people.
Some of the security arguments against TikTok and other Chinese apps were summed up in a 2019 paper for the Peterson Institute for International Economics, a Washington think tank. “Chinese authorities have ample leeway to request information from the private sector, on broadly defined public safety and security grounds, which include ‘stability maintenance’ — another name for suppression of dissent,” the Peterson paper said. “There have been multiple reports of dubiously-motivated data access, some even involving Chinese operations of American companies.”
So is there any security risk from using TikTok in Ireland? A senior Irish figure familiar with the interplay between business and politics says Trump’s attempted ban was seen more as a geopolitical “blow against China” than a security measure, and was more accurately perceived as “a pure political dig”, possibly in retaliation for the dumping of steel or solar cells on the US market. “There’s clearly an anti-China element.” Others see American pressure on TikTok as similar to European efforts in recent years to impose greater control over US tech giants.
Still, the senior Irish figure adds that TikTok’s app does not have the kind of strategic significance that led to the decisive US backlash against tech infrastructure gear produced by Huawei, the Chinese telecoms giant. “This is not what TikTok is essentially involved in at this stage. But data and the acquisition of data by big tech companies is an important part of their business model.”
Swingeing US restrictions on Huawei led in turn to a British ban on Huawei 5G equipment. Former UK business minister Vince Cable — once leader of the Liberal Democrats — later said London banned Huawei “because the Americans told us we should do it” and not for national security reasons. “I was caricaturing the situation,” Cable said to The Irish Times. “The compromise put forward by Theresa May — Huawei in the periphery of the 5G system but not the core — was impossible because the Americans had made some key components subject to sanctions and so the British would be forced to rely on Chinese components which were less ‘safe’ in security terms.”
US relationship
Washington’s pressure on Britain over Huawei raises questions as to whether similar pressure might be brought to bear on Dublin over TikTok’s increasing presence, given Ireland’s heavy and growing reliance on huge volumes of inward investment from the US.
IDA Ireland says “no” when asked whether any US client company or US government officials questioned the extent of Chinese investment in Ireland. But the senior Irish figure says: “I’d be very surprised if our friends across the Atlantic had not noted the [original] TikTok investment and the extra TikTok investment.”
A second person in the Dublin business world makes a similar point: “Ireland is obviously treading a fairly fine line when it comes to the China-US relationship. It’s more a sentiment factor in terms of Ireland’s relationship with the US. There is a bit of ‘are you with us or against us?’ at times.” The same person adds: “From time to time, senior US officials make it known to the Irish Government that they need to be conscious about risks from a security standpoint. I have seen officials come in saying: ‘I’m here to educate all of you.’”
TikTok faces an imminent reckoning in an investigation by Irish Data Protection Commissioner Helen Dixon into its compliance with European data laws on “platform settings for users under age 18 and age verification measures” for children younger than 13. “We have sent a preliminary draft decision to TikTok and we await their submissions,” Dixon’s office says. A draft decision for EU regulators is expected next month, potentially exposing the company to a large fine if it is found to have flouted the EU’s General Data Protection Regulation (GDPR). The Irish regulator is separately investigating TikTok’s transfers of personal data from the EU to China. TikTok did not reply on the record to questions about Dixon’s inquiries.
Neither did TikTok comment on class actions taken against it last year by Dutch consumer rights foundations. “TikTok has to pay compensation to all 4.5 million Dutch users,” says Remco Dolstra, a supervisory board member with one of the three litigants, Stichting Massaschade & Consument. This group, which challenges the legal basis for TikTok’s collection of user data, has claimed $6.8 billion (€6.5 billion) from the company, according to official records.
For all that, TikTok’s expansion plans in Ireland suggest it sees no substantive threat to its growth from any of the inquiries or cases against it.
But Prof Aiken, who says concerns about the risk of harmful TikTok content is similar to risks from such content on rival platforms, says a step-change in the regulatory approach is urgently needed.
“If you take a parallel industry, for example say the building or construction sector, there are any amounts of guidelines and protocols and best practice and inspection checks associated with health and safety in those sectors. The point about Big Tech and the online media sector is that we need the equivalent in terms of delivering on health and safety,” she says.
“There is a lot of work to be done. I have made this clear to the Government.”
