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How TikTok found its footing

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Today felt like an unusual lull in the intersection of our many unfolding national and global crises,
 
June 9 · Issue #523 · View online
The Interface
Today felt like an unusual lull in the intersection of our many unfolding national and global crises, and so I thought I’d take the opportunity to write about something different — a subject that, despite all my best efforts, I keep getting crushingly wrong. That subject is TikTok, the ByteDance-owned app whose fading into irrelevance I have been predicting for more than a year now, and which — to say that absolute least — has yet to arrive.
A new study on kids’ app usage and habits indicates a major threat to YouTube’s dominance, as kids now split their time between Google’s online video platform and other apps, like TikTok, Netflix and mobile games like Roblox. Kids ages four to 15 now spend an average of 85 minutes per day watching YouTube videos, compared with 80 minutes per day spent on TikTok. The latter app also drove growth in kids’ social app use by 100% in 2019 and 200% in 2020, the report found.
So basically, before TikTok, kids used social apps a certain amount. And then by 2019 they started using TikTok and that amount doubled, and then by this year it had tripled. If you are working on a social app, this is a good sign that you are doing something right.
And so it pains me — like, in an excruciating way — to say that if you have been reading The Interface for the past couple years, all this may have come as a surprise. Since ByteDance bought Musical.ly in 2018 and fused it with another app to create the sensation known as TikTok, I have been impatiently awaiting its demise.
Last August I wrote about how competition, regulation, and user retention problems could thwart TikTok’s ambitions. In November I wrote about how Congress and the Council for Foreign Investment in the United States were putting the squeeze on ByteDance — and about how the company’s past run-ins with the Chinese government had created a credibility gap with US regulators. In December I was warning about looming competition again, and by January I said ByteDance might be getting ready to sell TikTok off.
Looking back, I don’t believe that any of those predictions were irrational, exactly. All were based on things that were actually happening. Competitors were launching; regulators were starting to ask questions; and users were churning. But it’s clear that I’ve underestimated TikTok in two important ways: one, the appeal of the core product, which is way more powerful than I ever gave it credit for; and two, ByteDance’s nimbleness in responding to these challenges. And I overestimated the competition, which has so far been weak; and the regulators, who have mostly stuck to angrily shaking their fists at the sky in the American tradition.
So what’s working?
One, ByteDance is printing money, and money is power. TikTok itself generates significant revenue through advertising and in-app purchases, and ByteDance’s growing portfolio of apps has created a war chest it can use to reinvest in TikTok’s success. Here are Katie Roof and Zheping Huang in Bloomberg:
The company owes much of its success to TikTok, now the online repository of choice for lip-synching and dance videos by American teens. The ambitious company is also pushing aggressively into a plethora of new arenas from gaming and search to music. ByteDance could fetch a valuation of between $150 billion and $180 billion in an initial public offering, a premium relative to sales of as much as 20% to social media giant Tencent thanks to a larger global footprint and burgeoning games business, estimated Ke Yan, Singapore-based analyst with DZT Research.
“None of the Chinese tech companies has achieved this level of success in the global market before ByteDance,” he said, adding neither social media company harbors much debt. “The fact that ByteDance is making profit, if true, and sitting on a $6 billion cash pile means that it is not in a rush at all to come to market to raise capital
Two, TikTok keeps finding new users. My old view was that once ByteDance stopped buying new installs on Facebook, TikTok’s growth would level off. Instead, the pandemic hit, American teens were locked indoors for weeks on end, and TikTok became the most downloaded app in the world — installed 315 million times in the first quarter, according to third-party data, and reaching more than 2 billion cumulative downloads in the current quarter.
Three, ByteDance has rapidly leveled up its lobbying game. It hired its first American lobbyists a year ago, and in November hired a former congressman in anticipation of more regulatory pressure. Last month it hired the prominent executive Kevin Mayer away from Disney to be TikTok’s CEO, giving ByteDance a face of the American business establishment to go before Congress and ask questions about how the Communist Party of China might plan to use TikTok as part of an influence campaign. And to that last point, PingWest reported this week that ByteDance will begin restricting the access Chinese engineers have to TikTok’s code base.
There are good reasons to be skeptical about the data issue, as Ben Thompson laid out this week at Stratechery. “There are two problems here,” he wrote. “First, who is going to verify this, and second, the more concerning possibility to my mind is not so much user-data but rather the sort of algorithmic control that could very much sway hearts and minds. That, technically, is not ‘sensitive data’, it just happens to be very powerful data.”
I don’t know what ByteDance could do to convince us that it will never, ever share American user data with the Chinese government or allow state agents to manipulate its algorithms. At the same time, in recent weeks I have felt like TikTok is working to build trust where it can. After a recent issue in which view counts were improperly displayed for videos related to Black Lives Matter protests — part of a pattern in which content from minority communities has seemed to get lower distribution — TikTok established a creator diversity council and donated $3 million to nonprofits supporting the black community.
What impressed me so much weren’t the moves themselves so much as the speed with which TikTok made them: you can’t move that quickly unless you’re attuned to your user base, and that bodes well for the company as future crises inevitably arise.
The question is how long TikTok will be able to serve that user base before some conflict with China’s larger interests materializes. For ByteDance, this is not a theoretical question, as Alex Heath, Yunan Zhang and Jessica E. Lessin wrote in The Information:
The government sees the media as an essential instrument of domestic control and increasingly as a tool for projecting its views on the international stage. For example, in early 2018, after the government shut down Toutiao for 24 hours for posting what it called “pornographic and vulgar content,” ByteDance hired 2,000 content moderators, giving preference to Communist Party members in its recruitment.
But at this point, the mere existence of a threat to ByteDance no longer persuades me that the company won’t find some way to crush it. Skepticism is a reporter’s most valuable tool, but it ceases to be useful the moment it blinds you to the facts. TikTok isn’t just a fluke smash hit — it’s a durable one. Whatever problems lie down the road, and I’m sure there will be plenty, the least I can do is to stop underestimating it.

Pushback
Got some great feedback on yesterday’s column about how content moderation systems can replicate offline injustices. One reader shared a story of submitting printable Black Lives Matter posters to the Design subreddit and had his post removed for violating a ban on “politics.” Two others — one a moderator, one a researcher, wrote in about the difficulty of recruiting a diverse group of moderators. If you’re a white person, is it even ethical to recruit people of color to come do the hard labor of moderation for you — for free? And if you’re a person of color running a community, how do you attract white moderators to use their privilege on behalf of the community? Tough questions, but ones platforms can play a role in answering.
Also: more than 650 subreddits have now signed on to this open letter to Reddit calling for the company to, among other things, enact a site-wide policy against racism and hate speech.
The Ratio
Today in news that could affect public perception of the big tech platforms.
🔼 Trending up: Google is adding new COVID-19 alerts to Google Maps as cities begin to reopen. The updates include alerts from public transit agencies on mandatory precautions users need to take, such as like wearing a mask. (Chris Welch / The Verge)
🔼 Trending up: IBM is shutting down its general-purpose facial recognition business. In a letter to Congress, the company said it opposes the use of such technology for mass surveillance and racial profiling. Still, some questions remain about how committed IBM is to this decision. (Ina Fried / Axios)
Virus tracker
We introduced this section to better capture how the United States is doing in the fight against COVID-19. It’s now become clear that the virus is everywhere — and will continue to spread for the foreseeable future. With that in mind, we want to know: do you want us to keep tracking the total number of cases, deaths, and tests? Or should we retire this section altogether? Is there another configuration that would be more helpful? Let us know! (We also asked this yesterday but haven’t gotten much feedback yet.)
Total cases in the US: More than 1,987,800
Total deaths in the US: At least 112,100 
Governing
Four Republican senators in the United States are urging the Federal Communications Commission to act on Trump’s executive order on social media companies. The order would remove Section 230 protections for tech companies like Facebook and Twitter. Here’s David Shepardson at Reuters:
“Social media companies have become involved in a range of editorial and promotional activity; like publishers, they monetize, edit, and otherwise editorialize user content. It is time to take a fresh look at Section 230 and to interpret the vague standard of ‘good faith’ with specific guidelines and direction,” the senators wrote. […]
Trump’s order seeks to curtail their legal protections after Twitter Inc added a notice that one of his tweets violated its rules for “glorifying violence,” shortly after it slapped a fact-check label on another of his tweets opposing voting by mail. It was the first time Twitter had challenged his posts.
Employees at Microsoft wrote a letter to executives asking the company to cancel contracts with the Seattle Police Department. Over 250 employees supported the letter, which said, “Every one of us in the CC line are either firsthand witnesses or direct victims to the inhumane responses of SPD to peaceful protesting.” (Dave Gershgorn / OneZero)
Black Lives Matter protesters are demanding that Facebook stop funding local police in Menlo Park. Since 2017, Facebook has had a special “Facebook Unit,” which patrols the area surrounding the company’s billion-dollar headquarters. (Sarah Emerson / OneZero)
In a new indictment of Facebook’s content moderation strategy, a new study from NYU says the company’s decision to outsource such work is a key reason its efforts are failing. The report calls on Facebook to bring all content moderation in-house so it receives the resources and attention it deserves. (Chris O’Brien / Venture Beat)
A Twitter account impersonating @Breaking911 is spreading misinformation about the George Floyd protests. The account on which it is based has also been known to spread falsehoods, illustrating how news aggregators and “parody” accounts are used to quickly spread hoaxes. (Peter Slattery / OneZero)
Twitter users misidentified the person responsible for hitting children posting fliers in support of George Floyd. The man had biked along the route where the assault took place, and his fitness app shared the information. Once the falsehood was out, it was nearly impossible to correct. (Olivia Nuzzi / New York Magazine)
Twitter started adding fact-checking labels to tweets that falsely link 5G cellular networks with the novel coronavirus. “Get the facts about COVID-19,” reads the label, which links to news articles, official sources, and tweets debunking the conspiracy theory. (Shona Ghosh / Business Insider)
Alt-right trolls organizing on 4chan are trying to sabotage Black Lives Matter channels on Telegram. They’re encouraging people to post disinformation in the groups, find “incriminating” information that they can pass to law enforcement, and find as much personal identifying information as possible. (Ali Breland / Mother Jones)
Courts are moving to Zoom during the pandemic, which could create harsher outcomes for defendants. Studies have shown that people are more likely to be deported in immigration hearings if they appear on video than in person, and people applying for asylum are less likely to be granted it over video too. (Lauren Kirchner / The Markup)
Industry
While corporations have recently begun pouring money into anti-discrimination efforts and condemning racism online, they’ve also contributed to systematic inequality. Many have targeted the black community with unhealthy products and services, and failed to hire, promote and fairly compensate black men and women. David Gelles at The New York Times explains:
Mr. Moore said he was fed up with being one of just a relatively small number of black executives in the top tier of American business. “The list starts getting very thin very quickly,” he said. “There aren’t enough good examples. We’ve been satisfied with exceptions and exceptionalism.”
“We’ve been satisfied by putting John Rogers on every board,” he added, referring to the black investor who has been a director at Exelon, McDonald’s, Nike and The New York Times Company. “But we haven’t been deliberate about building bench and pipeline.”
Google outlined its plans to have employees return to the office, a process that will begin slowly starting in July. Changes involve staggering arrival times, administering temperature checks upon arrival, offering lunch boxes instead of buffets, and taking away sleep pods and massages. Sounds fun! (Hugh Langley / Business Insider)
Apple updated its COVID-19 iOS app and website with new features to allow users to anonymously share symptoms and health information. The aggregated data will be used to help inform the Centers for Disease Control and improve the organization’s COVID-19 screening protocol. (Darrell Etherington / TechCrunch)
Three start-up veterans created an online directory of coronavirus testing sites. They’re among a wave of volunteers contributing to the virus fight. (Daisuke Wakabayashi / The New York Times)
Amazon is suing Brian Hall, the former vice president of marketing at AWS, for taking a job at Google Cloud. The company alleges that his new role violates the terms of his non-compete agreement and risks exposing valuable competitive information to one of its biggest rivals. More importantly, this all led to one of the best “personal news” tweets of all time. (Todd Bishop / GeekWire)
Instagram hired Melissa Waters as its new global vice president of marketing. Waters previously worked at pharmaceutical startup Hims and Hers, and Lyft before that. (Rob Price / Business Insider)
Twitter is developing a new in-app system for requesting verification, according to a recent finding from reverse engineer Jane Manchun Wong. The discovery involves an added “Request Verification” option that appears in a redesigned account settings screen. (Sarah Perez / TechCrunch)
Twitter is bringing Fleets, its version of Stories, to India. The company says it is still testing the feature, which is also available to users in Brazil and Italy. (Manish Singh / TechCrunch)
Signal now lets users transfer account data and messaging history to a new iPhone or iPad from their existing iOS device. The pace of iteration at Signal has really picked up lately. (Jon Porter / The Verge)
Things to Do
Stuff to occupy you online during the quarantine.
Watch 13th. Netflix is streaming the entirety of Ava DuVernay’s Oscar-nominated film about mass incarceration for free on YouTube.
Organize a happy hour on Mixaba. It’s a video chat app that will periodically break you into smaller groups at random to replicate the feel of an in-person happy hour.
Listen to Run the Jewels 4. As Craig Jenkins says in this review, it’s exactly what America needs to hear right now.
Those good tweets
Neal Owusu
Now I be like “oh fuck i forgot my mask” like im spiderman or something
Stacie Michelle
Little known fact: Banana bread is actually the first step on one's journey to radicalization because it requires recognizing when something is rotting and needs to be turned into something else. https://t.co/MjbKmW44GB
Talk to us
Send us tips, comments, questions, and bad predictions: casey@theverge.com and zoe@theverge.com.
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