Dancing while Watching the Clock: Tik Tok’s Woes in India

Dr. Jean-Marc F. Blanchard's picture

ByteDance is facing up to USD $6 billion in losses from the Indian government’s decision to ban almost five dozen Chinese mobile phone apps including its Tik Tok and Helo. Concerns about Chinese mobile phone apps have been raised previously in regard to the dissemination of content violating social mores, the protection of consumer privacy, and the potential for the leakage of sensitive data back to China. Yet New Delhi has never before taken such strong measures. It is quite clear the trigger for its decision was the violent clash between Indian and Chinese forces on the border in June 2020. In various communications, ByteDance has touted that it “complies with all Indian data security and privacy requirements” and that it “is committed to working with the government to demonstrate our dedication to user security and our commitment to the country overall.” It also sent a letter to the Indian government emphasizing Beijing has never requested data from it and observing it would not turn over data even if requested to do so. In the background, Beijing has expressed concern about India’s action and Chinese media have given prominent attention to Tik Tok’s popularity, foreign direct investment, and employment in the country. ByteDance will have a hard time convincing India to soften its stance. After all, Tik Tok has become a national security issue and Indian firms are finding new opportunities in the wake of ByteDance’s struggles. Dancing to its own tune will not work—ByteDance must dance to the India market’s tune by building good local connections, establishing joint ventures with local firms, and opening its products to Indian security reviews. Otherwise, it may find itself shunted off the dance floor. Surprisingly, Beijing may prove a helpful partner as it appears inclined to stabilize or deescalate tensions with India.