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The TikTok Age

Zhang Yiming vs. Washington

Moving the Market: The meteoric rise of Zhang Yiming's TikTok in the United States, which I wrote about here, is forcing American lawmakers to wrestle with a future in which Chinese-backed firms adhering to Beijing's values hold sway over U.S. audiences.

• The big picture: TikTok's rise represents a potentially seismic shift in the global flow of digital influence. Since the advent of social media, we have lived in a world where U.S. firms controlled America's most popular networks. TikTok marks a radical break.

The latest: Lawmakers are concerned that Zhang's Bytedance, the TikTok parent company, has too much access to American users' data and that this could pose a national security risk were that data to be leveraged by Beijing.

• Sen. Josh Hawley, R-Mo., said yesterday that TikTok is "compromised by the Chinese Communist Party." While TikTok may not store user data in China, he said, the Chinese government could easily obtain access to it.

• "All it takes is one knock on the door of their parent company based in China from a Communist Party official for that data to be transferred to the Chinese government's hands whenever they need it," he said.

That, and: Lawmakers and free speech advocates are concerned that Bytedance will restrict users from posting controversial content in order to stay on Beijing's good side. There are signs that this is already happening.

• Bytedance has "imposed strict rules" prohibiting videos that they deem "subversive or controversial, including heavy kissing, heated debates and... political discussions," WaPo's Drew Harwell and Tony Romm report.

• "TikTok says its U.S. operation doesn’t censor political content or take instructions from [ByteDance] ... but former U.S. employees said moderators based in Beijing had the final call on whether flagged videos were approved."

What's next: All eyes are on the the Committee on Foreign Investment in the United States (CFIUS), which is conducting a national security review of ByteDance's $1 billion acquisition of Musical.ly, the Santa Monica-based social media app that it folded into TikTok.

• That investigation is seen as the most likely path by which the U.S. could move to curb Bytedance's influence in America.

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The Chinese censorship game

Postcard from Beijing, via NYT's Li Yuan: "When Bytedance introduced Toutiao, a news aggregation app that became hugely popular in China, it was run by software instead of an editor in chief. ... By the end of 2016, Toutiao became China’s No. 2 app after the messaging app WeChat."

• "In April 2018, Bytedance and a few other star start-ups were punished for running 'unhealthy' content. The company was ordered to shut down an app called Neihan Duanzi for hosting vulgar jokes and videos."

• "Mr. Zhang apologized, saying in a letter that he took responsibility for content that was incompatible with 'core socialist values.' He vowed to strengthen party building at Bytedance."

• "Like other online outlets, Toutiao also began featuring stories about Xi Jinping, China’s leader, at the top of its feed."

The upshot: "His apology seemed to be well received. Within two weeks, he delivered a keynote speech at a technology conference hosted by internet regulators. His topic: Bytedance’s global expansion strategy."

🏛️ Big in the Beltway 🏛️

Scoop: Politico publisher Robert Allbritton will launch his new tech news site (first reported here) in late January. It will be called Protocol and will have a newsroom staff of 30-35 people, with a "journalistic footprint" in Silicon Valley, New York, Washington, Europe and Asia.

• Protocol's editorial team will be led by Tim Grieve, who has served as vice president of news at McClatchy, editor-in-chief and president of National Journal and managing editor of Politico.

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Adam Silver takes NBA DTC

The streaming wars: "The NBA is making a cord-cutting play: NBA TV, the league’s 24-hour basketball channel previously available only through a cable or satellite TV provider, is now available as a standalone streaming service," Variety's Todd Spangler reports.

• "Pro hoops fans can subscribe directly over the internet to NBA TV, which carries over 100 live games per season along with original programming and a library of VOD content, for $6.99 per month (or $59.99 per year)."

The big picture: "The league says NBA TV is first linear sports league network to launch a direct-to-consumer subscription product. NBA TV is run by NBA Digital, jointly managed by the league and Turner Sports."

Market Links

• Mark Zuckerberg reveals another privacy mishap (CNBC)

• Randall Stephenson settles data dispute with FTC (WSJ)

• John Legere wins FCC approval for the Sprint deal (WSJ)

• Jim VandeHei considers taking Axios international (BI)

• Caryn Marooney joins the venture capital game (Recode)

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Rupert Murdoch buys local

Big in Bel Air: Rupert Murdoch's Fox "has bought three TV stations from Nexstar, the top U.S. owner of local stations, in a $350 million transactions that will give the company a position" in 14 of the top 15 local markets, Deadline's Dade Hayes reports.

• The big picture: "The stations joining the Fox fold — KCPQ and KZJO in Seattle and WITI in Milwaukee — line up with the sports rights held by the company, which has pursued a business model emphasizing live events and sports."

Ilya S. Savenok/Getty

James Goldston on defense

Moving Midtown: ABC News is facing questions "about its reluctance to air a sensitive story of alleged sexual misconduct after a leaked video emerged of reporter Amy Robach complaining about how her bosses handled an interview with a Jeffrey Epstein accuser," AP's David Bauder reports.

• "The conservative web site Project Veritas released video of Robach venting that 'every day I get more and more pissed' that her 2015 interview with Virginia Giuffre never made the air."

• "ABC said Tuesday that the interview didn’t meet its standards because it lacked sufficient corroborating evidence. Robach... said the leaked video caught her 'in a private moment of frustration.'" ABC also said that it "never stopped investigating the story."

The big picture, via Bauder: "The episode was remindful of Ronan Farrow’s accusations that NBC News discouraged his reporting on Hollywood mogul Harvey Weinstein’s misconduct."

• NBC News disputes Farrow's account and NBC News chairman Andy Lack has said Farrow "simply didn’t have a story that met our standard for broadcast nor that of any major news organization."

📚 What's next: "A Warning." Read Vanity Fair's Joe Pompeo on the chattering class parlor games leading up to the release of the highly anticipated tell-all from the senior White House official known as Anonymous.

See you tomorrow.