Category: China Meltdown

@ebakerwhite: Security Failures At TikTok’s Virginia Data Centers: Unescorted Visitors, Mystery Flash Drives And Illicit Crypto Mining@ebakerwhite:

For years, TikTok has told lawmakers that the private data of its U.S. users is secured — and safe from potential influence or exfiltration — in a cluster of data centers located in Northern Virginia.

But interviews with seven current and former employees and more than 60 documents, photos and videos from the data centers reveal that the centers have faced security vulnerabilities ranging from unmarked flash drives plugged into servers to unescorted visitors to boxes of hard drives left unattended in hallways. Sources suggest that these challenges are the result of TikTok trying to grow its data storage capacity very quickly, and sometimes cutting corners along the way.

Documents, photos, and interviews also suggest that TikTok’s data center operations are still tightly enmeshed with ByteDance’s business in China. Among other suppliers, the data centers use servers produced by Inspur, a company that the Pentagon said in 2020 was controlled by the Chinese military and that the Commerce Department added to a sanctions list last month. Documents also show that as recently as last week, server work orders were sent to data center technicians by Beijing ByteDance Technology Co., Ltd., a ByteDance subsidiary partially owned by the Chinese government, which TikTok has repeatedly insisted has no control over its operations.

Read the post on Forbes and also Chris Castle’s panel at MusicBiz conference in 2020.(don’t say you weren’t warned)

@ebakerwhite: TikTok Parent ByteDance Planned To Use TikTok To Monitor The Physical Location Of Specific American Citizens

[Well, here it is. Two years ago we warned everyone who would listen that TikTok were apparatchiks for the Chinese Communist Party–by law in China because of the CCP’s civil-military fusion–“If Google is the Joe Camel of data, then TikTok is the Joe Camel of intelligence.” We did panels warning about TikTok including the CEO’s struggle session and the CCP constitution–facts, you know. Tim Ingham warned that on top of everything else, the deals suck. And then there’s Twinkletoes, who is in our view a walking, talking Foreign Agent Registration Act violation.

[According to Emily Baker White writing in Forbes:]

China-based team at TikTok’s parent company, ByteDance, planned to use the TikTok app to monitor the personal location of some specific American citizens, according to materials reviewed by Forbes.

The team behind the monitoring project — ByteDance’s Internal Audit and Risk Control department — is led by Beijing-based executive Song Ye, who reports to ByteDance cofounder and CEO Rubo Liang. 

The team primarily conducts investigations into potential misconduct by current and former ByteDance employees. But in at least two cases, the Internal Audit team also planned to collect TikTok data about the location of a U.S. citizen who had never had an employment relationship with the company, the materials show. It is unclear from the materials whether data about these Americans was actually collected; however, the plan was for a Beijing-based ByteDance team to obtain location data from U.S. users’ devices.

Read the post on Forbes

George Soros: Investors in Xi’s China face a rude awakening

[ARW readers could probably guess that I’m not a fan of George Soros–a man who for reasons of his own has financed most of the anti-artist front groups around the world. But when he’s right, he’s right and in this op-ed from the Financial Times, he’s definitely right and Blackrock is definitely wrong.]

The crackdown by the Chinese government is real. Unnoticed by the financial markets, the Chinese government quietly took a stake and a board seat in TikTok owner ByteDance in April. The move gives Beijing one seat on a three-person board of directors and first-hand access to the inner workings of a company that has one of the world’s largest troves of personal data. 

The market is more aware that the Chinese government is taking influential stakes in Alibaba and its subsidiaries.  Xi does not understand how markets operate. As a consequence, the sell-off was allowed to go too far. It began to hurt China’s objectives in the world.

Recognising this, Chinese financial authorities have gone out of their way to reassure foreign investors and markets have responded with a powerful rally. But that is a deception. Xi regards all Chinese companies as instruments of a one-party state. Investors buying into the rally are facing a rude awakening. That includes not only those investors who are conscious of what they are doing, but also a much larger number of people who have exposure via pension funds and other retirement savings. 

Read the post in the Financial Times

@julia_marnin: China [CCP] Orders Broadcasters to ‘Put An End’ to ‘Sissy Men,’ and ‘Other Abnormal Esthetics’

[Editor Charlie sez: Will TikTok be next?]

The Chinese government ordered its TV broadcasters to “put an end to sissy men and other abnormal esthetics,” its TV regulator said, as China’s Communist Party cracks down on its society for a “national rejuvenation” ordered by President Xi Jinping, the Associated Press reported.

China’s TV regulator insultingly addressed effeminate men with the slang term “niang pao” meaning “girlie guns.” The order to “put an end” to them demonstrates the Chinese government’s worries that male pop stars provide a lack of masculine influence for the nation’s men. Meanwhile, in nearby Japan and South Korea, many male pop stars are known for having a sleek and feminine image.

In addition, broadcasters were ordered to not promote “vulgar internet celebrities” alongside celebrity culture and that broadcasters should “vigorously promote excellent Chinese traditional culture, revolutionary culture and advanced socialist culture.”

Read the post on Newsweek

@nate_taplin: New Age of Chinese Nationalism Threatens Supply Chains

Relations between China and the West are off to a rocky start in 2021. Observers watching China and the U.S. trade accusations in Alaska, and Europe and China trade sanctions days later can be forgiven for a cold feeling in the pit of their stomach. Beijing’s tolerance for economic risk in the service of nationalism has rarely looked higher.

That could bode ill for many, not least Taiwan and the littoral states of the South China Sea. The trade conflict between the U.S. and China has metastasized into a broader geopolitical confrontation—while China’s armed forces are nearing parity with the U.S. in the former’s backyard. Chinese incursions into Taiwan’s air defense identification zone have at times become a near daily occurrence since late 2020, while the U.S. is busy rallying allies such as Japan to plan for contingencies.

A significant conflict between the U.S. and China in East Asia is still unlikely, but it can no longer be ruled out as an implausible tail risk. Companies need to start considering what that could mean. And governments need to find mutually acceptable ways to take the temperature down if they want regular business to remain possible.

Read the post on the Wall Street Journal