The Week in Tech: TikTok Is in Trouble

Each week, we review the week’s news, offering analysis about the most important developments in the tech industry.

Hi, I’m Jamie Condliffe. Greetings from London. Here’s a look at the week’s tech news:

Do you like TikTok? A lot of people do. The breezy music app has been downloaded nearly 1.5 billion times globally and 122 million times in the United States, according to the data firm Sensor Tower. It’s one of the fastest-growing cultural phenomena in years, and is more popular than Facebook among 13- to 16-year-olds in the United States, Axios reports.

That’s also why some people hate it.

Silicon Valley companies dislike it because it’s cashing in on a market opportunity — and they haven’t yet successfully replicated it, my colleague Jack Nicas wrote. He reported that Facebook’s clone, Lasso, has been downloaded fewer than 500,000 times; YouTube has been considering cribbing its features; and Google has held acquisition talks with Firework, a TikTok imitator.

Officials in the United States also worry about the Chinese ownership of an influential app. The Committee on Foreign Investment in the United States reportedly opened a national security review of the Chinese company ByteDance’s acquisition of Muscial.ly, the American app that later became TikTok.

Senator Marco Rubio, Republican of Florida, accused the app of “censoring content that is not in line with the Chinese government and Communist Party directives.” A Washington Post report appeared to support that theory:

Former U.S. employees said moderators based in Beijing had the final call on whether flagged videos were approved. The former employees said their attempts to persuade Chinese teams not to block or penalize certain videos were routinely ignored, out of caution about the Chinese government’s restrictions and previous penalties on other ByteDance apps.

And during a congressional hearing on Tuesday, Senator Josh Hawley, Republican of Missouri, stoked fears about how TikTok may be forced to send data to the Chinese government because of laws there that require companies to comply with intelligence operations:

“A company compromised by the Chinese Communist Party knows where your children are, knows what they look like, what their voices sound like, what they’re watching and what they share with each other.”

TikTok has denied these allegations. It says that it doesn’t send data to China, and that its California moderation team reviews content for adherence to United States policies.

That might not matter. The speed with which government officials are coming down on TikTok has made it look like Mark Zuckerberg had all the time in the world to prepare a defense for Facebook. And TikTok is being exposed to two vectors of attack — about social media censorship and the sharing of Americans’ data with China — that are both hot-button issues for lawmakers.

Mr. Hawley already raised the possibility of a subpoena that would force TikTok to testify before Congress. I would be amazed if that didn’t happen. And I would be fairly surprised if we don’t see some kind of punitive measures leveled at TikTok, and soon.

Money can’t solve every problem.

For buying scarce stuff, money is kind of useful. We’ve seen that in action with housing in California: As big companies have lured hundreds of thousands of employees to the state with high pay, the supply of housing hasn’t kept up. Demand has driven the median home value in San Jose, Calif., to nearly $1 million, roughly double the price from 2012.

Big Tech accounts for much of the influx and has drawn most of the ire. So in June, Google pledged $1 billion in grants and loans in California to help ease the problem. Last month, Facebook offered $1 billion to the same end. And this past week, Apple announced that it would spend $2.5 billion on mortgages and affordable housing to help, too.

Problem solved, with cold, hard cash? Well, no, as my colleague Conor Dougherty pointed out.

First, it costs about $450,000 to build a single unit of subsidized affordable housing in California. So the $4.5 billion that Google, Apple and Facebook have earmarked would, in simple terms, create about 10,000 homes. The money could stretch further. But McKinsey believes California needs 3.5 million extra homes by 2025 — the orders-of-magnitude difference is stark.

The bigger problem is that local government zoning rules have largely prohibited high-density housing in the sate. As Rolling Stone has pointed out, 94 percent of San Jose is zoned for single-family homes; 30 minutes away in Atherton, zoning allows only single-unit buildings with a footprint that doesn’t exceed 18 percent of their plot.

Money alone can’t change this. Until zoning rules soften, the law of supply and demand will mean that prices will stay high.

Halloween delivered a nightmare scenario for Airbnb: Five people were killed at a party in one of its rental houses in Northern California. Vice also published a damning report about a nationwide scam on the platform.

Both of those problems brought into sharp relief an issue that Airbnb has long grappled with: trust. Or rather, the lack of it. Is the place you book safe? Will it be like it’s supposed to be? If you’re letting out your place, will guests wreck it?

On Wednesday at the New York Times DealBook conference, the company’s chief executive, Brian Chesky, announced that Airbnb planned to conduct a comprehensive review of every property listed on its platform. It will check the accuracy of photographs, addresses and other information posted with each property, as well as verify that the listings meet safety standards and that the hosts are who they say they are. It will also introduce other peace-of-mind policies, like a hotline for concerned neighbors

But there’s a bigger point here, one that some tech chief executives may do well to consider. Mr. Chesky said internet companies were now realizing that they had to “take more responsibility for the stuff on our platform.” He added: “This has been a gradual, maybe too gradual, transition for our industry.”

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Source: nytimes.com

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