The TikTok logo is seen outside the office of social media app company TikTok in Culver City, California on March 16, 2023.

Patrick T. Fallon | AFP | Getty Images

TikTok risks being banned in the US if China’s ByteDance doesn’t sell its stake. Millions of Americans who use the popular video app are wondering what it means for them.

Some fans of the service may turn to virtual private networks (VPNs) to try to connect to TikTok if banned. This is a workaround that can give the impression that their Internet connection is coming from another country. But this loophole may not be so easy to exploit.

This is not a problem yet, as there are still several ways to avoid TikTok’s ban or access it legally in the US. Here are the main things covered.

What a foreclosure or forced sale might look like

The Committee on Foreign Investment in the United States (CFIUS) is an interagency body that assesses the national security concerns surrounding the application to determine how to minimize the risk if it continues to operate domestically. The group could recommend to President Joe Biden that he stop ByteDance’s 2017 acquisition of, TikTok’s predecessor, which would force a sale of those assets.

TikTok has recommended a mitigation plan as an alternative to a forced sale. But that’s a long shot, as CFIUS has already threatened a ban if ByteDance doesn’t sell its stake.

A forced sale would be a complicated move that would require undoing a deal that has lasted for years. The Trump administration has previously followed this path without success. The Chinese government is likely to oppose this again, but it will have to be careful in its protests because the core of its argument against the US is that TikTok operates independently.

“That would be part of the calculation and how aggressively China would want to respond,” said Lindsay Gorman, a senior fellow at the New Technologies Division of the Alliance for Democracy at the German Marshall Fund. Gormany previously served as a senior adviser in the Biden White House.

If the US bans TikTok, the mechanics of what happens from there become murky. Oracle is a cloud hosting service for all TikTok users on US ISPs such as Comcast (parent company of NBC Universal) and Verizon direct traffic to end users. And controlled app stores an apple and Google are the main places to download the TikTok app.

Shannon Reeves, a partner in Stroock’s CFIUS compliance group, said any third-party requirements would not come from CFIUS, which is tasked only with evaluating foreign investments.

“As a result of this review, CFIUS will not take action against third parties not involved in this transaction,” Reeves said. “So your Apple, Google and so on that it’s not going to happen.”

To force app distributors, ISPs and cloud services to block access to TikTok, the government may have to resort to legislation or executive orders.

While there will likely always be loopholes that can be exploited by some computer-literate users, it will be difficult for the typical consumer to access a government-prohibited service, said Douglas Schmidt, a Vanderbilt engineering professor.

“There will almost always be ways around it,” Schmidt said. “It would be a lot harder for the average person to do that without getting a degree in computer security or something.”

In other words, a VPN won’t be enough, in part because going this route will likely require app store credentials that reveal the user’s location. Gerald Kasoulis, vice president of NordVPN, said there is also technology that can detect when a user is trying to access an app through a VPN.

Security issues

Concerns about TikTok’s security risks boil down to two main issues. First, who can access information about US consumers, and second, who has the ability to determine what information reaches US users. Under Chinese law, companies may be required to share internal information with the government for alleged national security purposes.

TikTok has sought to assure the US government that US users’ data is stored outside of China. The company has developed a detailed plan, known as the Texas Project, that includes a review of its code in the US and a separate board of directors for a domestic subsidiary whose members are subject to scrutiny by the US government.

TikTok CEO Shaw Ji Chu, who is scheduled to testify before a US House panel next week, told The Wall Street Journal that Project Texas would do as little as divestment to address any security concerns.

But the mood in Washington isn’t moving in TikTok’s favor, and lawmakers have lost any confidence they once had in China and its motives. The issue resurfaced earlier this year when an alleged Chinese spy balloon was spotted flying across a large swath of the US. Last month, Biden ordered the military to shoot down the balloon.

When it comes to consumer technology, users have no idea what information is making its way to the Chinese government. And the US government needs to do a lot of work to provide clarity on what will happen if the app is banned.

“Even for someone who studies these things, it’s not easy to disconnect and untangle all these programs,” Gorman said. “As a society, we have not decided that app stores, the Apple App Store or the Google Play Store, should limit apps based on the amount of information they collect. It can’t be targeted at an individual, and that’s really for the government to address.”

While many users might think their casual social media use would be of little interest to a foreign government, Schmidt said the data can have surprising value to bad actors.

“Information about your habits and your interests and your interactions and where you go and what you do can be used for things like phishing attacks to get access to more information, or for things like blackmail when you do things that you might not want other people to know about,” Schmidt said.

This is unfamiliar territory for American companies, unlike China, which blocks access to all kinds of content, including most major US Internet services.

“Trying to control access to data is very, very difficult, especially if you suspect that the people who are doing it have reasons to do it,” Schmidt said. “And they have a strong incentive to collect that information and use it for all kinds of purposes.”

Subscribe to CNBC on YouTube.

WATCH: Uncertainty over TikTok’s fate sends rival shares soaring

Uncertainty over TikTok's fate is sending shares of rivals soaring

Source by [author_name]

Previous articleVenture capitalists and US lawmakers unite to fight China’s influence: WSJ
Next articleElizabeth Holmes owes Theranos more than $25 million, the lawsuit says