There is a new twist in the TikTok tale

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Back in 2020, when then US president Donald Trump threatened to ban TikTok because of alleged Chinese influence, Microsoft tried and failed to buy the app’s US operation — a move that chief executive Satya Nadella later dubbed “the strangest thing” he had ever done.

Now events are becoming even stranger. Last month President Joe Biden signed a bill demanding that ByteDance, TikTok’s China-based owner, sell its US operations by January 2025, or face a ban. ByteDance is now fighting this through the US courts. Meanwhile, Trump himself has apparently flipped and seems to oppose a ban, probably because Jeff Yass, one of several major US ByteDance investors, is also a big Trump supporter.

But stranger still, some of Trump’s key allies, such as Robert Lighthizer, hate China’s alleged influence over TikTok, while Steven Mnuchin, Trump’s former Treasury secretary, seems eager to buy it.

And this week Frank McCourt, the real estate mogul and fierce critic of Big Tech, launched a putative “people’s bid”, via Guggenheim investment bank. This is backed by Tim Berners-Lee, founder of the world wide web, and Jonathan Haidt, the influential social psychologist whose new book, The Anxious Generation, decries social media.

In reality, this public gambit seems quixotic, if not publicity-grabbing. McCourt claims he has an edge in any contest, since he does not want to buy the recommendation algorithm. This is considered to be TikTok’s secret sauce, which many in Washington allege is tightly controlled by Beijing and thus key to US national security concerns. “We will likely be the only bidder who will not be interested in the algorithm,” McCourt tells me, insisting that removing it is the only way to build a healthier platform.

But McCourt tells me he has not discussed his move with Beijing and does not yet have funding in place for the group. And ByteDance has no incentive to negotiate while fighting a ban in US courts — or if it thinks that Trump might win in November and overturn it.

Still, tech investors should not ignore McCourt: if nothing else, this bid raises questions that challenge our assumptions about how cyberspace might look in the future.

The issue at stake partly revolves around control of the so-called “social graph”, or users’ online data and digital footprint. In recent years, prominent voices such as McCourt and Haidt have lashed out at Big Tech’s control of the social graph, arguing this is being used to manipulate us all in unhealthy ways, via opaque algorithms, like the one inside TikTok.

The instinct of most policymakers — and parents — is thus to want to turn back the clock and curb social media. But this seems unrealistic given that the digitisation of our lives has not just changed our daily habits, but also our cognitive maps and innate cultural patterns in at least two important ways.

The first is a shift away from so-called “vertical” trust relations to “lateral” ones — from garnering advice from institutions and authority figures to a networked peer group. The second is rooted in what I call the rise of “Gen P” — Generation “Pick’n’ Mix” or “Playlist” — whose members are becoming addicted to customising their cyber lives according to individual consumer choices, and doing this in a way that is amplified by the rise of artificial intelligence tools.

These two shifts are leading internet users to cluster in like-minded tribes online, where they decide what is “true” by scanning peer group feelings and experiences, with startling results. A poll by the Center for Countering Digital Hate, for example, shows that teenagers are the most conspiracy-minded generation.

And striking ethnographic research by Jigsaw, a branch of Alphabet, and others suggests that young people now trust their peers for advice in most spheres of life, valuing them more than doctors for medical information, say. Indeed, AI bots are increasingly trusted more than human authority figures, because of the love for customisation and peer advice. Yes, really.

This is frightening, given that online tribalism and bots can be — and often are — manipulated. The White House, for example, fears that China is using the TikTok algorithm to manipulate consumer “choices”.

But it seems futile to hope that these two shifts can go into reverse: Gen P is embedded. Thus the key question is whether there is any way to work with these trends to clean up the internet, rather than wishing them away?

McCourt insists the answer is “yes” — and has poured $500mn into a “Liberty” platform that uses open source protocols to give individuals personal control over their social graph, to be less prone to manipulation. He hopes to use TikTok to scale this. Berners-Lee has similar goals via a so-called Solid platform.

This, of course, sounds even more quixotic than their TikTok bid. Big Tech will not cede ground without a fight and there is no guarantee that individuals who control their social graph will use it wisely.

But before they dismiss this, tech investors should remember that the internet has already evolved extraordinarily fast, in once unimaginable ways, and could do so again. Or to put it another way, quixotic or not, this new twist in the TikTok tale shows how “strange” looks increasingly normal, in a political, geopolitical and psychological sense. Don’t count anything out.