James Kynge

But ByteDance owns 19.9%.

So the Chinese company remains a pretty significant shareholder.

Now, the really important thing I think about these companies, and in the case of the TikTok US joint venture, it is also the most important thing, is the algorithm.

The TikTok business is nothing without the algorithm that underlies it.

And although Oracle is now responsible for securing the data of American users and overseeing the retraining of the recommendation algorithm using American sources, you know, so American data will be used to retrain the algorithm, the control of the algorithm will remain in the hands of ByteDance.

And it will lease the algorithm to the American joint venture, TikTok joint venture.

And it will get payments for that of around 20% of the American entity's revenue.

Now, so...

this to me means it is ByteDance that remains in control of the algorithm.

And that to me is, you know, that's the key point, because it means that presumably ByteDance can tweak the algorithm anytime it wants without informing the US entity.

And it gives ByteDance an operational

relationship with the company in the US.

Do you see it like that, Alice?

Or am I being too kind of reds under the bed about this?

No, I think that's such a good point.

I think this opens a Pandora's box for virtually any Chinese tech company that's collecting data in foreign markets.

This sets a template or at least an example of what might be done, what should be done, what could be done in order to increase data security that these Chinese companies are collecting either in the US market or the UK or European market or anywhere else in the world.

And I think it's so right of you, Alice, to point to what Western companies had to do in China.

And for me, the main example was the way Apple in 2018 had to transfer its mainland Chinese iCloud user data

to a joint venture called Guizhou Cloud Big Data that's situated in the southwestern province of Guizhou.