TikTok’s CEO navigates the limits of his power – Virusha Tech

TikTok recently tried to tamp down concerns from U.S. lawmakers that it poses a national security threat because it is owned by the Chinese internet company ByteDance. The viral video app insisted it had an arm’s-length relationship with ByteDance and that its own executive was in charge.

“TikTok is led by its own global CEO, Shou Zi Chew, a Singaporean based in Singapore,” TikTok wrote in a June letter to U.S. lawmakers.

But in fact, Chew’s decision-making power over TikTok is limited, according to 12 former TikTok and ByteDance employees and executives.

Decisions about the service — including moves to emphasize livestreaming and shopping on TikTok — are made by Zhang Yiming, ByteDance’s founder, as well as by a top ByteDance strategy executive and the head of TikTok’s research and development team, said the people, who declined to be identified for fear of reprisals. TikTok’s growth and strategy, which are led by ByteDance teams, report not to Chew but to ByteDance’s office in Beijing, they said.

The arrangements illustrate the tightrope that Chew, 39, walks as the head of one of the world’s most popular social apps. Since being appointed TikTok’s CEO in May 2021, he has had to navigate presenting himself to the West as the autonomous leader of a global service while fulfilling the demands of the app’s Chinese parent.

Chew faces mounting challenges. As TikTok has stormed its way onto people’s smartphones and accrued an estimated 1.6 billion monthly active users, its ByteDance ties have raised concerns that it may be siphoning off people’s data to Chinese authorities. In recent months, U.S. lawmakers and regulators have increasingly questioned TikTok’s data practices, reigniting a debate over how the United States should treat business relationships with foreign companies.

On Wednesday, TikTok’s chief operating officer testified in Congress and downplayed the app’s China connections. On Thursday, President Joe Biden signed an executive order to sharpen the federal government’s powers to block Chinese investment in tech in the United States and to limit its access to private data on citizens.

In an email, TikTok said Chew was ultimately responsible for the app’s product and strategy decisions. ByteDance said he was familiar with the company’s business.

Little is known about Chew and how he operates TikTok. But the former TikTok and ByteDance employees said he had focused on bringing financial discipline to the app during a global downturn. He has tightened budgets, shuttered marketing experiments and laid off employees in North America as the app has moved more operations to Singapore, they said. Chew has also met with global business executives and European regulators.

In a meeting late last year, one TikTok employee asked where Chew saw the app in 100 years. “I just want to make money next year,” he said, according to three people who were on the call.

But ByteDance has more control, others said. “If he didn’t want to do something ByteDance wants him to do, he could be fired and someone else could be put in his place,” Salvatore Babones, the director of China and free societies at the Center for Independent Studies, an Australian think tank, said of Chew.

Chew has acknowledged a familiar relationship with ByteDance that dates to when he helped invest in the firm nearly a decade ago.

In March 2021, Chew announced that he was joining ByteDance as chief financial officer, fueling speculation that the company would go public. (It remains privately held.)

Two months later, TikTok appointed Chew as CEO, with Zhang praising his “deep knowledge of the company and industry.” Late last year, Chew stepped down from his ByteDance role to focus on TikTok.

TikTok had been without a permanent CEO since August 2020, when Kevin Mayer, a former Disney executive, left after the Trump administration’s effort to sunder the app from its Chinese parent. China was also cracking down on its domestic internet giants, with Zhang resigning from his official roles at ByteDance last year. Zhang remains involved in decision-making, people with knowledge of ByteDance said.

ByteDance has kept optics in mind in choosing TikTok CEOs, five people with knowledge of Chew’s appointment said. Mayer, who was based in Los Angeles, was hired because he was an American at a time when TikTok wanted to look distinct from its Chinese parent, they said. Chew straddles the Western and Chinese business worlds, with Singapore offering a hedge against any potential crackdown from China or the United States, they said.

But both Mayer’s and Chew’s power as TikTok’s head has been circumscribed by ByteDance, five people with knowledge of the company said.

Changes to TikTok’s core app and its features run through Zhang; ByteDance CEO Liang Rubo, who was Zhang’s college roommate; Zhao Pengyuan, a ByteDance strategy executive; and Zhu Wenjia, the head of TikTok’s research and development team, the people said. ByteDance executives direct TikTok’s development by seeing what happens first on Douyin, its Chinese counterpart, they added.

In May, Chew flew to Davos, Switzerland, for the World Economic Forum, speaking with European regulators and ministers from Saudi Arabia to discuss digital strategy.

More recently, he has defended TikTok’s data practices. In the app’s June letter to U.S. lawmakers, he noted that ByteDance employees in China could gain access to the data of Americans when “subject to a series of robust cybersecurity controls.” But he said TikTok was in the process of separating and securing its U.S. user data under an initiative known as Project Texas, which has the app working with American software giant Oracle.

“We know we’re among the most scrutinized platforms,” Chew wrote.

This article originally appeared in The New York Times.