Pressure by Western government officials on China-based TikTok is growing, as the United Kingdom has now joined the fray in turning the heat up on the video-sharing app and further U.S. scrutiny awaits the hugely popular site.
The U.K. said late Thursday it will block TikTok from government devices. That came shortly after President Joe Biden called for a ban of the app or for China-based parent ByteDance to divest the operation. And next week, TikTok's chief executive is scheduled to testify before a Congressional panel.
TikTok CEO Shou Zi Chew is due to testify before the House Energy and Commerce Committee on Thursday. He'll face questions about the app's ties to China. He'll also address concerns that it delivers harmful content to young people. Federal agencies have also raised security concerns as a central reason.
"Americans deserve to know how these actions impact their privacy and data security, as well as what actions TikTok is taking to keep our kids safe from online and offline harms," the House Energy and Commerce Committee said in a written statement.
A core reason is the fear that sensitive data could be accessed by the Chinese government. More than 100 million Americans use the app.
TikTok To Spend $1.5 Billion For Protections
For its part, TikTok plans to spend $1.5 billion on a program to safeguard U.S. user data and content from Chinese government access or influence.
The company says divesting the company does not offer any more protection than what it has already proposed.
"If protecting national security is the objective, divestment doesn't solve the problem," TikTok said. "A change in ownership would not impose any new restrictions on data flows or access.''
The company went on to say: "The best way to address concerns about national security is with the transparent, U.S.-based protection of user data and systems. with robust third-party monitoring, vetting, and verification."
Rival social media players enjoyed major gains Thursday as the heat started to rise for TikTok. But then they settled back to earth Friday.
After jumping more than 3.6% Thursday, Facebook-parent Meta dropped 4.6% to close at 195.61 on the stock market today. Snapchat-owner Snap dropped 3.5% to 10.70 in the wake of Thursday's 7.3% gain. And Pinterest edged down a fraction to 26.37 after a 6% surge Thursday on the TikTok news.
Please follow Brian Deagon on Twitter at @IBD_BDeagon for more on tech stocks, analysis and financial markets.
