By Laura He for CNN Business
Two prominent Chinese media outlets are urging Beijing to kill what they call a “dirty” and “unpalatable” deal intended to keep TikTok operating in the United States.
The editorial boards of China Daily and the Global Times — both state-run publications — this week blasted an arrangement that would give American companies at least some ownership in the short-form video app. TikTok’s parent company ByteDance is based in Beijing.
“What the United States has done to TikTok is almost the same as a gangster forcing an unreasonable and unfair business deal on a legitimate company,” China Daily wrote in an editorial published Wednesday, which called the deal a “dirty and underhanded trick.”
The terms of the tentative deal for China’s most successful global app have caused a lot of confusion.
The initial announcement last weekend implied that ByteDance would continue to own a majority of Tiktok going forward, raising questions about how that could resolve the Trump administration’s national security concerns about Chinese control of the app and its data.
But Trump has since indicated that investors Walmart (WMT) and Oracle (ORCL) would “own the controlling interest.” A person familiar with the deal told CNN Business earlier this week that a new US entity — TikTok Global — will be partially owned by ByteDance’s international and Chinese investors, but that ByteDance itself will hold zero percent of the company to be created by the deal to run the app outside of China.
“It seems as if TikTok can remain in the US. But only if ByteDance allows Oracle and Walmart to effectively take over the company,” China Daily added. “China has no reason to give the green light to such a deal.”
The Global Times, a state-run tabloid, also slammed the deal this week in two editorials calling on Chinese regulators to block it.
“It’s hard for us to believe that Beijing will approve such an agreement,” the Global Times wrote in one editorial. In a second piece titled “TikTok extortion deal is unpalatable gambit,” the publication added that “we should not let Washington control the lifeline of China’s technological development in the future. ”
Chinese state media is a powerful tool in the country’s propaganda machine, and the various outlets and their editorials are often looked upon as barometers of sentiment among senior officials. Some publications, like the Global Times, are more hawkish than others.
Notably, the China Daily and Global Times editorials were published in English — an indication that the TikTok editorials are likely intended for an overseas audience. State media editorials in China may also act as trial balloons for ideas, or to send a message to Western governments. (China Daily is an English-language paper, but Global Times also has a much more popular Chinese edition. Similar editorials were published in that edition, too.)
The extent to which Beijing still needs to review the deal is also not entirely clear.
Last month, Chinese regulators introduced new rules that govern the sale of certain kinds of technology to foreign buyers — a change that experts pointed out would likely require ByteDance to obtain government permission before selling TikTok to a foreign company. ByteDance has said that Oracle would be able to review the app’s source code, but that the deal does not involve the transfer of its algorithms and technologies.
A source familiar with the negotiations, meanwhile, told CNN Business this week that ByteDance isn’t concerned about regulatory approval from China. The source said there are still a few details left to sort out in the United States, indicating optimism that the deal could still close despite the media and political firestorm.
Selina Wang contributed to this report.