Alan Rosenstein
speaker
80 appearances
1 recordings
1 series
first heard Dec 2024
last heard Dec 2024
Alan Rosenstein’s voice in public audio — every appearance, attributed to the second.
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Appearances
One thing you could do, and this would be the most direct and most effective thing, would be to get Congress to repeal the law. Because if the law is repealed, then the law is repealed. Then there's no issue. The problem there is that it's going to be very hard to do that. The law was passed with overwhelming bipartisan support.
I mean, it was essentially as bipartisan as anything gets in contemporary Washington. And although, of course, Trump has a really strong hold on the Republican Party, And maybe some Democrats don't love the idea of banning TikTok when they're hearing from their constituents. I am skeptical that Trump can get the votes, right? That even Trump has the political juice to get this thing done.
And I think it really has to be one of the main things he spends his political capital on in his first 100 days. I'm just not convinced he wants to do that. So the second thing he could do is he could just declare that... the government is not going to enforce the law. So the law is enforced through primarily penalties on these companies.
The attorney general goes and sues Apple and Oracle for violating the law up to $5,000 per user. And as you mentioned before, there are 170 million American users of TikTok. So that adds up to a lot of money very quickly.
Absolutely. Right. And that is within his power. And no one could really challenge that decision. The problem is that Trump is very mercurial. He changes his mind frequently. He often seems to be basically acting based on whoever was the last person he talked to. So just because he directs the attorney general not to enforce the law, that doesn't make the law go away.
Apple and Oracle would still be in a position of violating the law. And again, if you're the general counsel of Apple, and it's certainly if I was, I would feel very uncomfortable telling my CEO to go ahead with an action that could potentially open my company up to billions of dollars in liability based on liability.
Some truth social post that Trump made directing future Attorney General Pam Bondi not to enforce the law. So I don't think that's going to be good enough. So the third thing Trump can do, and this is, I think, if he wants to help TikTok, this is probably how he's going to do it, is to just declare that the law no longer applies. And the reason he can do that is because the law...
bans TikTok unless ByteDance, TikTok's Chinese owner, performs what the law calls a qualified divestiture, basically a qualified sale. And then the law also defines what a qualified divestiture is. And it says, qualified divestiture is when the president determines after an interagency process that, and then there's a bunch of language about what's supposed to actually happen.
TikTok is no longer owned by ByteDance. TikTok is no longer owned or controlled by a Chinese entity and so on and so forth. But if you just focus on the first few words of that definition, the president determines, well, that does give the president some power.
Now, one way you can read that is to say that the president gets some amount of discretion, maybe a little bit of discretion, maybe a lot of discretion to determine what counts as a qualified divestiture.
And it's not clear who would be able to challenge that kind of determination, specifically, who would be able to challenge if Trump just declared that ByteDance has performed a qualified divestiture. And so there's a scenario in which... ByteDance could move some papers around, shift some assets from one corporation to another corporation, do some fancy legal work.
And that would give Trump enough basically cover to declare that TikTok is no longer controlled by ByteDance. The question ultimately, however, is, is that going to be enough for the apples and oracles of the world to continue to do business with TikTok? And we just don't know the answer to that question.
It's a great question. I think it would definitely have value. The question is how much value. So there's no question that TikTok became very popular because it had a better algorithm, right? ByteDance built a better mousetrap than the American social media companies when it came to short form video and the market rewarded them as the market ought to.
At this point, it's actually not clear to me how much of the value of TikTok is in the algorithm and let's say how much better that algorithm is to the other comparable algorithms. Because, of course, Meta's TikTok competitor has its own algorithm. Google's TikTok competitor has its own algorithm. And all these algorithms, they're pretty similar.
At this point, to make a good algorithm, you need a big company with a lot of data and a ton of compute and a lot of good machine learning engineers, which Meta and Google all have. So I suspect that even if TikTok's algorithm is the best, it's not orders of magnitude better in the way that it might have been when TikTok first started.
I mean, clearly, this is telling me that I need to get on TikTok if I'm a law professor, and there's a demand for these kinds of answers. No, again, there are many things that might be going on here. One, it might be that the algorithm is better. But the other thing that might be happening, and I think this is maybe more relevant to your original question, is
The content on TikTok might be better, which is to say there may be more people on TikTok and they're, quote unquote, better people in the sense of creating content. But that is different than the algorithm and that can be sold. So what there is no Chinese law against is ByteDance selling TikTok without the algorithm. And that itself might be valuable enough.
Now, it's not going to be as valuable as TikTok with the full algorithm. But it might still be quite valuable. And one could imagine a situation in which a U.S. company buys TikTok, which is to say it buys all its users, it buys all the content, it buys the network itself, minus the algorithm, and then replaces the algorithm with something else. Now, it won't be as good.
But it probably will be good enough to keep the people on TikTok on TikTok. And because the algorithm is really based on the data, at some point, that new owner will have enough data to recreate something like the algorithm. But I would say that the deeper issue here is, yes, there is a law in China that prohibits the sale of the algorithm because it prohibits the export of Chinese technology.
But we have to be realistic here. What's going to determine whether ByteDance sells TikTok is not Chinese law, but the Chinese government. We take for granted in the United States and in liberal democracies that a private company is a private company and that although it has to comply with the laws of the jurisdiction, it's still a private company. That's just not the case in China.
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