TikTok owner in AI and blockchain venture with Chinese state media
Reports of Chinese state cooperation with ByteDance could diminish image yet further in the eyes of American regulators
ByteDance Inc, the parent company of the social media platform TikTok, has become partners with a media group owned by the Chinese government.
They will research and develop potential business uses of artificial intelligence and blockchain technology.
The venture has been under way for a week but came to light after statements on the National Enterprise Credit Information Publicity System, an official Chinese business registration website.
A unit of ByteDance now owns 49 per cent of the newly created Pengpai Audiovisual Technology, with the remaining stake owned by Shanghai Dongfang Newspaper Co.
The company has registered capital of ¥10m ($1.4m, £1m). The Paper.cn, a popular Chinese digital news outlet, is owned by Shanghai Dongfang, which in turn is controlled by the Shanghai United Media Group, which itself is funded and influenced by the local Shanghai government. There has been no comment from either company.
ByteDance will hope that its latest cooperation with the Chinese government will not further worsen its popular subsidiary TikTok in the eyes of American regulators.
American youngsters aged 16-24 comprise 60 per cent of the platform's more than 26 million monthly users.
Washington has become increasingly concerned that the data of an entire generation of US citizens could fall into the hands of the Chinese government.
In November the Committee on Foreign Investment in the United States (CFIUS) opened a national security investigation into TikTok, over its 2017 $1bn acquisition of American rival Musical.ly.
In December it emerged that TikTok is facing a class action lawsuit in the US District Court for the Northern District of California, which alleges the app “vacuumed up and transferred to servers in China vast quantities of private and personally-identifiable user data.”