Ever since news hit that ByteDance had agreed a deal with Oracle Corp and Walmart for its US TikTok operations to satisfy White House demands, there has been a stream of critical commentaries from China’s state-owned media, throwing the agreement into further doubt.
The state-owned China Daily, which calls itself “the national English-language newspaper”, in an editorial on Thursday described recent White House action against ByteDance as “banditry” and that “Beijing is unlikely to condone the White House’s strong-arm acquisition.”
“After all, no deal is better than a deal made under duress,” it wrote.
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The deal between the Chinese owner of the global short video hit and the Oracle-led group faces hurdles in obtaining approval from both the White House and Beijing, with Trump wanting US control to safeguard national security and Beijing reluctant to approve a deal that looks like a US victory.
ByteDance said last week it had applied for a technology export licence to comply with China’s recently-revised tech export rules, even though it has said that the current proposal “does not involve the transfer of any algorithms and technologies”. Oracle will have the authority to access the source code of TikTok US for security checks only.
The People’s Daily online, a website under the Chinese Communist Party’s official paper, ran a three-part series of critical opinion pieces last week.
The third commentary was published on Saturday morning. It said closing TikTok would mean thousands of job losses for local employees and content creators, “a result US politicians cannot afford”.
“China will never give in. This is not only to resolutely safeguard the legitimate interests of Chinese companies but also to firmly practice the business ethics of fair trade. The United States must be made aware that capricious behaviour will inevitably need to pay a price,” it said, written under the pseudonym ‘Zhigang’.
In a piece published on Thursday, the second in the series, it argued that Oracle’s access to TikTok’s algorithms meant that the US government could possibly gain the source code of Douyin, TikTok’s sister app in China.
This would “put the private data of Chinese citizens and China’s national security at a risk,” said the commentary, written under the pseudonym ‘Qingqiu’.
“We have zero tolerance for any threats related to national security. Chinese citizens care about the national security interest and whether the overseas interests of a Chinese enterprise could be protected … We have enough reasons to question the motivation of the US government.”
In the first of the series, it said that the goal of the forced sale was to seize control of an influential Chinese company and that Trump’s apparent step back was just a “big trap waiting for you to jump”. The piece was written by Xiang Ligang, who has penned commentaries for several state media.
“[The rhetoric] shows Beijing’s displeasure and unhappiness about the whole situation,” said Cameron Johnson, an adjunct faculty instructor at New York University Shanghai and partner at consultancy Tidal Wave Solutions.
“But … they have not said no to the export licence that TikTok applied for a few days ago. If they were really so unhappy and they really didn’t want it to go through, they would have immediately rejected it.”
ByteDance has pushed the deal forward despite public reservations from both Washington and Beijing.
China’s Ministry of Commerce confirmed Thursday that Beijing’s Municipal Commerce Bureau had received the tech export licence application submitted by ByteDance. “We will process it according to the relevant laws and regulations,” ministry spokesman Gao Feng said.
Meanwhile Hu Xinjin, editor-in-chief of the Global Times tabloid which is affiliated with the People’s Daily, wrote last week that based on his knowledge, “Beijing won’t approve [the] current agreement” as it would “endanger China’s national security, interests and dignity.”
A Global Times editorial on Tuesday called it “blackmail” and “plunder”.
Another China Daily editorial on Wednesday called the deal “a dirty, underhand trick.”
“China has no reason to give the green light to such a deal, which is dirty and unfair and based on bullying and extortion. If the US gets its way, it will continue to do the same with other foreign companies. Giving in to the unreasonable demands of the US would mean the doom of Chinese company ByteDance,” said the editorial.
Details of the deal itself remain vague, adding flames to the debate.
ByteDance has said it will hold 80 per cent of the shares of TikTok Global, the new entity to be created in the US as a result of the deal, after the pre-IPO funding round that will bring in Oracle and Walmart.
However, Oracle said in a statement to reporters late on Monday in the US that “Americans will be in the majority and ByteDance will have no ownership in TikTok Global.”
Trump said on Monday he would not approve a deal between Oracle and TikTok unless the US owners gain control over the app, in a reversal of his statement over the previous weekend that the deal had his “blessing”.
“From another angle, I think China’s [tech export control] rules help ByteDance to refuse an outright sale based on the laws and policy in China,” said Zhang Dingding, an independent internet industry commentator. “Such a big deal needs to be approved by both sides.”
Johnson said Beijing could be playing for time.
“China’s waiting for the US election. I think they’re just going to wait. And whoever wins – they’ll deal with it after that, because they have no incentive to approve it now,” he said.
More from South China Morning Post:
- Oracle chairman says SoftBank’s Masayoshi Son likely to join TikTok board: Fox Business
- Trump and Beijing face off again: Both don’t like ByteDance’s Oracle deal but for different reasons
- After criticism in China for ‘kneeling down’ to the US, ByteDance affirms its control over TikTok Global
- Here’s what you need to know about Oracle’s deal to buy TikTok in the US from China’s ByteDance
- US adds further restrictions on WeChat and TikTok ahead of deadline for ByteDance to complete Oracle deal