TikTok Is Paying a High Price to Convince the Western World of its Safety

TikTok must convince much of the Western World it protects user data or risk bans that could eat at its profits.

The TikTok logo appears with a fish-eye lens.
TikTok is spending billions in the U.S. and E.U. AFP via Getty Images

TikTok’s is no longer fighting bans just in the U.S. The popular short-form video app is trying to convince not only the U.S. of its safety, but much of the Western world.

The company discussed its plan to safeguard European users’ data in London yesterday (March 6), the Wall Street Journal reported. The campaign, dubbed “Project Clover,” aims to convince European regulators the video sharing app has enough independent oversight in place to mitigate the risk of being owned by Chinese parent company ByteDance. TikTok is building two new data centers in Ireland and one in Europe to store European data, and it will hire a third party company to oversee operations in Europe, according to the Journal.

The offensive mimics a similar effort in the U.S. called “Project Texas,” a $1.5 billion proposal in which U.S.-based tech company Oracle will monitor TikTok’s data transfers and the U.S. government will have some level of oversight of its algorithm.

TikTok’s campaigns to appease Western governments will be a multi-billion dollar effort. In addition to the $1.5 billion TikTok is spending in the U.S., one of its new European data centers will cost 420 million euros ($445 million). The company did not disclose the price of the other two centers or lobbying costs.

Risking the loss of a quarter of TikTok’s global users

With a combined 225 million monthly active users in the E.U. and U.S., according to the most recent data releases from the company, the two territories represent 23 percent of TikTok’s estimated 1 billion monthly active users. Proposed bans from Western governments could make a huge dent in TikTok’s profits.

In the U.S., moves to regulate or ban TikTok have gained bipartisan support in recent months. A House of Representatives committee voted on March 1 to advance a bill giving President Joe Biden the power to ban TikTok in the U.S. More than half of U.S. state governments, the U.S. House and college campuses have barred the app on their wifi networks and on work devices. Canada and the E.U. instituted similar measures last month.

Not all Western governments have established widespread bans across state devices. The U.K. hasn’t announced any decision, and Australia and New Zealand are leaving the option up to individual departments. While barring the app on government devices doesn’t necessarily presage nation-wide bans, it does shine light on the opinions of regulators regarding TikTok’s operations.

TikTok Is Paying a High Price to Convince the Western World of its Safety