ByteDance

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ByteDance Ltd.
Native name
字节跳动有限公司
TypePrivately held company; partially state-owned
IndustryInternet
FoundedMarch 13, 2012; 9 years ago (2012-03-13)
FoundersZhang Yiming
Liang Rubo[1]
Headquarters,
China
(global operation headquarters)
Cayman Islands[2]
(legal domicile)
Area served
Worldwide
Key people
Zhang Yiming, Chairman & CEO
Chew Shou Zi, CFO[3]
Roland Cloutier, global CSO[4]
Erich Andersen, global GC[5]
ProductsToutiao
TikTok/Douyin
BuzzVideo
Vigo Video
Helo
Resso
RevenueIncrease US$37 billion, (2020)[6]
Number of employees
~110,000[7]
SubsidiariesMoonton
Lark
Nuverse
Websitewww.bytedance.com

ByteDance Ltd. (Chinese: 字节跳动; pinyin: Zìjié Tiàodòng) is a Chinese partially state-owned multinational internet technology company headquartered in Beijing and legally domiciled in the Cayman Islands.[8][9] It was founded by Zhang Yiming in 2012.

ByteDance is the developer of the video-sharing social networking services and apps TikTok and Douyin, the Chinese-specific counterpart to TikTok.[10][11] It also develops the news and information platform Toutiao ("Headlines").[12]

As of November 2018, ByteDance had over 800 million daily active users (over 1 billion accumulated users) across all of its content platforms.[13][needs update] It has garnered public attention over allegations that it worked with the Chinese Communist Party (CCP) to censor and surveil content pertaining to Xinjiang internment camps and other topics the CCP deemed controversial.[14][15][16]

History[edit]

Background and founding[edit]

In 2009, software engineer and entrepreneur Zhang Yiming collaborated with his friend Liang Rubo to co-found 99fang.com, a real estate search engine.[17] In early 2012, the pair rented an apartment in Zhongguancun and, along with several other 99fang employees, began developing an app that would use big data algorithms to classify news according to users' preferences, which would later become Toutiao.[18] That March, Yiming and Liang founded ByteDance.[19]

First apps: Neihan Duanzi and TouTiao[edit]

In March 2012, ByteDance launched its first app, called Neihan Duanzi (内涵段子). This allowed users to circulate jokes, memes, and humorous videos. At its peak in 2017, Neihan Duanzi had over 200 million users .[20]

In August 2012, ByteDance launched the first version of news and content platform Toutiao ("Headlines"), which would become their core product.[21] Toutiao hit 1 million daily active users four months after its launch.[22]

In 2018, ByteDance permanently sunsetted Neihan Duanzi, after the National Radio and Television Administration accused the app of hosting "vulgar" and "improper" content and "triggering strong sentiments of resentment among internet users".[23] In response to Neihan Duanzi's shutdown, founder Zhang Yiming issued a letter stating that the app was "incommensurate with socialist core values" and promised that ByteDance would "further deepen cooperation" with the authorities to promote their policies.[24][25] Following the shutdown, ByteDance announced that it would give preference to Chinese Communist Party members in its hiring and increase its censors from 6,000 to 10,000 employees.[26][27][28]

Expansion into new markets[edit]

From late 2016 through 2017, ByteDance had a number of acquisitions and new product launches.

In December 2016, it invested in the Indonesian news recommendation platform BABE.[29] In July 2017, it launched the UGC short video platform Hypstar (Vigo Video) in Southeast Asia.[30]

In February 2017 it acquired Flipagram, and in November it acquired Musical.ly, merging them both into TikTok. In November it also acquired News Republic from Cheetah Mobile.[31]

Corporate affairs[edit]

Leadership[edit]

Zhang Yiming was the co-founder, chairman and CEO of ByteDance. On May 19, 2021, the company announced that Zhang Yiming would step down as CEO at the end of 2021 and his co-founder Liang Rubo would become CEO.[1]

On 19 May 2020, ByteDance and Disney released an announcement that Kevin Mayer, head of Disney's streaming business, would join ByteDance. From June 2020 to his resignation 26 August 2020, Mayer served as the CEO of TikTok and the COO of ByteDance, reporting directly to the company CEO Zhang Yiming.[32][33][34] In 2021, Chew Shouzi, former CFO of Xiaomi, took over as TikTok CEO.[35]

As with many Chinese companies, the company has an internal CCP committee serving the party members among the employees, with vice president Zhang Fuping serving as its Party Committee Secretary.[36]

In April 2021, a Chinese state-owned enterprise with ties to the Cyberspace Administration of China took an ownership stake in ByteDance's main Chinese entity and gained a seat on its board.[37][38][39]

Funding[edit]

ByteDance is financially backed by Kohlberg Kravis Roberts, SoftBank Group, Sequoia Capital, General Atlantic, and Hillhouse Capital Group.[40] As of March 2021, it was estimated to be valued at $250 billion in private trades.[41]

Partnerships[edit]

ByteDance has a strategic partnership with the Chinese Ministry of Public Security for the ministry's public relations efforts,[42] and joint ventures with a state-run publisher in Beijing and media firm in Shanghai.[43][44]

Products[edit]

Douyin[edit]

Douyin (Chinese: 抖音; pinyin: Dǒuyīn), the Chinese version of TikTok, is a short-form video platform that differs from its international counterpart by having more advanced features, such as e-commerce. As of August 2020, the app had 600 million daily active users.[45] TikTok and Douyin have almost the same user interface but no access to each other's content. Their servers are each based in the market where the respective app is available.[46]

Lark[edit]

First released to the public in 2019, Lark is ByteDance's enterprise collaboration platform.[47] Its features include cloud-based file management and document and spreadsheet editing. Lark was originally developed as an internal tool, becoming ByteDance's primary internal communication and collaboration platform, but was eventually made available to external users in certain markets.[48]

TikTok[edit]

TikTok is a video-sharing social networking service[49] used to make short-form videos, from genres like dance, comedy, and education.[50][51] TikTok users create short videos, often featuring music in the background, including short lip-sync videos to popular songs. Videos can be sped up, slowed down, or edited with a filter.[52] The app has spawned numerous viral trends, Internet celebrities, and music trends around the world.[53]

On November 9, 2017, ByteDance acquired Shanghai-based social media start-up Musical.ly for up to US$1 billion. They combined it and prior acquisition Flipagram[54][55] into TikTok on August 2, 2018, keeping the TikTok name.

In 2020, Morning Consult ranked TikTok as the third fastest growing brand of the year, after Zoom and Peacock.[56]

Toutiao[edit]

Toutiao (Chinese: 今日头条; pinyin: Jīnrì Tóutiáo), launched in August 2012,[21] started out as a news recommendation engine and gradually evolved into a platform delivering content in various formats, such as texts, images, question-and-answer posts, microblogs, and videos.[57][58]

In January 2014, the company created the "Toutiaohao" (头条号) platform to attract more PGC (professionally generated content) and UGC (user generated content) creators; and later in the year, added video capabilities. Toutiao used interest-based and decentralized distribution to help long-tail content creators find an audience. An often cited example is "Zhuguan Baba" (猪倌巴巴), a young pig farmer in Northern China whose posts on how to raise pigs attracted millions of readers on Toutiao.[59][60]

In 2017, Toutiao acquired Flipagram. ByteDance would later expand Toutiao's features to include: a missing person alerts project whose alerts have helped find 13,116 missing persons as of June 2020;[61] short-form video platform Toutiao Video, later rebranded as Xigua Video (西瓜视频, also known as Watermelon Video), which hosts video clips that are on average 2–5 minutes long;[62][63] and Toutiao Search, a search engine.[64]

Xigua Video[edit]

Initially launched as Toutiao Video in 2016, Xigua Video (Chinese: 西瓜视频; pinyin: Xīguā shìpín) is an online video-sharing platform[65][66][67] that features user-created short and mid-length videos and also produces film and television content. As of June 2020, the platform has 131 million monthly active users.[68][69]

Other products and acquisitions[edit]

  • Gogokid is an online English learning platform for children that provides one-on-one classes with native English speakers.[citation needed]
  • Moonton: In 2021, Bytedance acquired Moonton, the developer of the mobile esports game Mobile Legends: Bang Bang.[70][71]
  • Neihan Duanzi, ByteDance's first app, was sunsetted in 2018.
  • Resso is ByteDance's "social music streaming app." The platform allows users to highlight and share lyrics, comments and other user-generated content with each other alongside streaming of full-length tracks.[72] Resso says that it has licensing agreements in place with Warner Music Group, Sony Music Entertainment, Merlin and Beggars Group, among others.[73]
  • TopBuzz was a content platform for videos, articles, breaking news and GIFs. The platform was launched in the U.S. in 2015 and later in Brazil in 2016.[74] ByteDance launched PGC short video platform TopBuzz Video in Japan in September 2016.[75] It was sunsetted in 2020.[76]

Technology[edit]

ByteDance's research arm, the AI lab, was founded in March 2016. It is headed by Wei-Ying Ma, former assistant managing director of Microsoft Research Asia.[77] The lab's research focuses on AI for understanding information (text, images, videos) in depth, and developing large-scale machine learning algorithms for personalized information recommendations.[78]

In 2016, ByteDance's AI Lab and Peking University co-developed Xiaomingbot (张小明), an artificial intelligence bot that wrote news articles.[22][better source needed]

In March 2021, the Financial Times reported that ByteDance was part of a group of Chinese companies that aimed to deploy technology to circumvent Apple's privacy policies.[79][80]

In April 2021, it was announced that ByteDance has created a new division called BytePlus which will be selling the underlying platform of TikTok, so others may launch similar apps.[81]

Reception and regulation[edit]

Huxiu[edit]

In December 2018, ByteDance sued Chinese technology news site Huxiu for defamation after Huxiu reported that ByteDance's Indian-language news app Helo was propagating misinformation.[82]

US Federal Trade Commission fine[edit]

On February 27, 2019, the Federal Trade Commission fined TikTok US$5.7 million for collecting information from minors under the age of 13 in violation of the Children's Online Privacy Protection Act in the United States.[83][84] ByteDance later added a kids-only mode to TikTok which blocks the upload of videos, the building of user profiles, direct messaging, and commenting on other's videos, while still allowing the viewing and recording of content.[85]

US executive orders[edit]

On 3 August 2020, U.S. president Donald Trump set September 15 as the deadline for TikTok, a social media app under ByteDance, to find a US buyer, and he then issued executive orders that would effectively ban TikTok[86] from operating in the country if it is not sold by ByteDance within 45 days.[87] Then at 12:40 PM of August 3, Beijing local time, ByteDance founder Zhang Yiming sent out an all-staff letter in response to the potential sale of TikTok's US operations.[88]

On 7 August 2020, ByteDance released a statement in response to the executive order banning US companies and individuals from doing business with it, threatening to resort to the American justice system in order to get "fair treatment."[89][90] On 14 August 2020, Trump issued an executive order mandating that ByteDance divest from all U.S. operations of TikTok within 90 days.[91] On 28 August 2020, the Chinese Ministry of Commerce and the Chinese Ministry of Science and Technology announced that any sale of ByteDance's technology to foreign firms is a matter of "national security" and would require prior approval.[92]

Ban in India[edit]

Citing national security issues the Indian Government banned TikTok along with 58 other Chinese apps on June 29, 2020.[93] The ban was made permanent in January 2021.[94][95] In March 2021, the Indian government froze ByteDance's bank accounts in the country for alleged tax evasion, which ByteDance disputed.[96]

Regulation in China[edit]

In April 2020, the Cyberspace Administration of China (CAC) ordered ByteDance to take down its office collaboration tool called Feishu because it could be used to circumvent Internet censorship.[97] In April 2021, ByteDance was among 13 online platforms ordered by the Chinese central bank to adhere to tighter data and financial regulations.[98] The bank stated that Bytedance must conduct comprehensive self-examination and rectification to adhere to the country's laws.[99] In May 2021, the CAC stated that ByteDance had engaged in illegal data collection and misuse of personal information.[100]

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