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Oracle Wins in TikTok Takeover Race, Though Technical Questions Remain

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With the White House’s September 15th (or 20th) deadline looming, it looks as though TikTok will remain in operation in the US, with a consortium bid, lead by enterprise software giant Oracle, named on Sunday as the preferred partner by TikTok’s parent company ByteDance.

As reported by The Wall Street Journal:

“Oracle [has] won the bidding for the US operations of the video-sharing app TikTok, a person familiar with the matter said. […] Oracle is set to be announced as TikTok’s “trusted tech partner” in the U.S., and the deal is likely not to be structured as an outright sale, the person said.”

Microsoft officially confirmed that it was out of the running for TikTok earlier in the day, with short statement posted on the Microsoft blog.

ByteDance let us know today they would not be selling TikTok’s US operations to Microsoft. We are confident our proposal would have been good for TikTok’s users, while protecting national security interests.”

Microsoft noted that it was focused on improving the platform’s security measures, addressing user privacy concerns, and combating disinformation:

“We look forward to seeing how the service evolves in these important areas.”

The statement seemed pointed towards key issues that maybe Microsoft doesn’t believe the Oracle-lead bid will be as well-suited to address. But ByteDance chose not to go with the Microsoft plan – which sets up a very interesting scenario for the future of the fast-growing video app.

Of specific interest is how TikTok will now work under its new ownership, once all the details are established – because also on Sunday, a report in the South China Morning Post explained that due to the Chinese Government’s new regulations restricting the sale of technological advancements to foreign companies, TikTok’s algorithms will not be included in the deal.

As per SCMP:

“[ByteDance] will not hand out source code to any US buyer, but the technology team of TikTok in the US can develop a new algorithm,” according to a source. The source, who did not want to be identified, said ByteDance had notified US authorities and potential bidders of the decision.”

If this is correct, then it seems that Oracle and its consortium partners will essentially be paying for the TikTok brand name, and access to its 100 million+ monthly active users in the US. 

What the impact of not including TikTok’s algorithms would be is difficult to say – some have suggested that TikTok, without its powerful machine learning system, will “wither and die“, while others expect that building a similar system, on top of its current base, won’t be so complex.

But it doesn’t seem like the ideal starting point for a non-social media company to be wading into – Oracle has no experience in managing social platforms, while its investment firm partners in its TikTok bid will be focused on revenue, and you would expect, will be keen to monetize the platform as much and as fast as possible in order to maximize their return.

And while it may seem like it can’t be that complex to formulate an algorithm based on the current TikTok base, there’s a lot that’s gone into the app’s success. TikTok’s rapid growth was built on the back of ByteDance’s years of experience in creating other social networks in China, including the Chinese-only version of TikTok, called ‘Douyin’, which was a huge success before they even considered launching TikTok in the US.

Douyin

Indeed, Douyin was launched in 2016, two full years before ByteDance purchased and re-branded Musical.ly as TikTok in western markets in August 2018. In those two years, ByteDance had been able to establish key learnings on what works, what resonates, and formulate its algorithms based on millions of people already engaging within the app.

That gave TikTok a massive jump start – so while the system may appear fairly basic, and it may seem like another company will be able to work out a recommendation algorithm that’s close enough to be viable, a lot more work has gone into developing TikTok’s systems than many expect.

But of course, Oracle and Co. know this, this is not new information. Yet, they’re still willing to go ahead. There must be some level of confidence that they’ll come out on top here, that they can progress, in limited partnership with ByteDance, and build a successful platform.

Will that happen? I wouldn’t bet on it.

That’s not to say TikTok is doomed, it could be fine, it could work out okay. But various examples suggest that this will not be smooth sailing, and while TikTok still continues to grow and become a bigger platform, it’s not too big to fail. Definitely not.

Vine, which was essentially the precursor to TikTok had more than 200 million active users at peak, but it failed because parent company Twitter couldn’t work out an equitable monetization process in order to keep its top creators from migrating to YouTube and Instagram instead. Twitter’s management is obviously very experienced in social media and maximizing engagement, it had a huge knowledge base of people who knew the field inside and out. Yet that wasn’t enough to keep Vine running – and worth noting, Vine founder Dom Hoffman has made paying creators a top priority with his new app Byte, which he launched earlier this year.    

Snapchat is another platform that almost lost out by ignoring creators for years, before eventually coming around and refocusing its efforts on establishing a more equitable partnership-type system, which now ensures that top users are compensated and motivated to maintain engagement, helping to maximize usage. 

TikTok has also acknowledged the importance of such with its Creator Fund program, through which it plans to pay out a billion dollars in the next three years to its top creators.

TikTok Creator Fund

But that program is already facing problems, with the first round of participants citing poor payout amounts and impacts on their reach, which some have speculated is due to TikTok limiting their viewership in order to reduce payout amounts.

This is a complex area, that will take experience and expertise to manage. And while TikTok definitely has the experience in ex-YouTube exec Vanessa Pappas, I can’t help but think that Oracle is not the best fit for the company in this respect.

Microsoft might not be either, but LinkedIn has continued to grow under its ownership. At least it has some base of knowledge in this area to tap into.

If the new TikTok team can’t work out the key algorithm details, can’t evolve its monetization programs, and can’t, essentially, learn from the mistakes that other platforms have made in the past, it will fall flat. That might be difficult to envision now – especially with TikTok once again leading the app download charts in August. But it can, absolutely fail. And even with those great download stats, in 2020, who knows what they truly represent?

Social media usage is way up on normal amounts as people look for distractions during the various lockdowns and in replacement of their normal social gatherings and entertainment events. TikTok’s numbers are clearly being inflated beyond what’s normal because of this – so in normal times, how many people will be using TikTok as much? 

And with new ownership that’s less familiar with dealing with the ebbs and flows of social platform engagement, can it overcome these key challenges and still establish itself as a key player in social media space?

As noted, there are still many technical details to be clarified yet, so no one knows for sure how it will all play out. But there are many moving parts, and various potential pitfalls that could end up derailing the app. 

Socialmediatoday.com

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Cheeky branding wins (and missteps)

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Cheeky branding wins (and missteps)

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Branding and rebranding is getting more fun, here we look at some of cheekiest brands that have caught our eye – for the right and wrong reasons.



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Google Outlines Ongoing Efforts to Combat China-Based Influence Operations Targeting Social Apps

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Google Outlines Ongoing Efforts to Combat China-Based Influence Operations Targeting Social Apps

Over the past year, Google has repeatedly noted that a China-based group has been looking to use YouTube, in particular, to influence western audiences, by building various channels in the app, then seeding them with pro-China content.

There’s limited info available on the full origins or intentions of the group, but today, Google has published a new overview of its ongoing efforts to combat the initiative, called DRAGONBRIDGE.

As explained by Google:

In 2022, Google disrupted over 50,000 instances of DRAGONBRIDGE activity across YouTube, Blogger, and AdSense, reflecting our continued focus on this actor and success in scaling our detection efforts across Google products. We have terminated over 100,000 DRAGONBRIDGE accounts in the IO network’s lifetime.

As you can see in this chart, DRAGONBRIDGE is by far the most prolific source of coordinated information operations that Google has detected over the past year, while Google also notes that it’s been able to disrupt most of the project’s attempted influence, by snuffing out its content before it gets seen.

Dragonbridge

Worth noting the scale too – as Google notes, DRAGONBRIDGE has created more than 100,000 accounts, which includes tens of thousands of YouTube channels. Not individual videos, entire channels in the app, which is a huge amount of work, and content, that this group is producing.

That can’t be cheap, or easy to keep running. So they must be doing it for a reason.

The broader implication, which has been noted by various other publications and analysts, is that DRAGONBRIDGE is potentially being supported by the Chinese Government, as part of a broader effort to influence foreign policy approaches via social media apps. 

Which, at this kind of scale, is a concern, while DRAGONBRIDGE has also targeted Facebook and Twitter as well, at different times, and it could be that their efforts on those platforms are also reaching similar activity levels, and may not have been detected as yet.

Which then also relates to TikTok, a Chinese-owned app that now has massive influence over younger audiences in western nations. If programs like this are already in effect, it stands to reason that TikTok is also likely a key candidate for boosting the same, which remains a key concern among regulators and officials in many nations.

The US Government is reportedly weighing a full TikTok ban, and if that happens, you can bet that many other nations will follow suit. Many government organizations are also banning TikTok on official devices, based on advice from security experts, and with programs like DRAGONBRIDGE also running, it does seem like Chinese-based groups are actively operating influence and manipulation programs in foreign nations.

Which seems like a significant issue, and while Google is seemingly catching most of these channels before they have an impact, it also seems likely that this is only one element of a larger push.

Hopefully, through collective action, the impact of such can be limited – but for TikTok, which still reports to Chinese ownership, it’s another element that could raise further questions and scrutiny.

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The Drum | Trump’s Instagram & Facebook Reinstatement Won’t Cause Marketers To Riot Yet, Experts Say

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The Drum | Trump's Instagram & Facebook Reinstatement Won’t Cause Marketers To Riot Yet, Experts Say

While the reinstatement of Donald Trump’s Twitter account in November had some advertisers packing up in protest, many will strike a different tune with Meta-owned Facebook and Instagram, experts predict.

Meta Wednesday announced that it’s lifting the ban on a handful of Facebook and Instagram accounts, including that of former US president Donald Trump – who was suspended nearly two years ago following the January 6, 2021 riots at the Capitol.

In a blog post yesterday, Nick Clegg, Meta’s president of global affairs, explained the reasons for the company’s decision, saying that it “evaluated the current environment” as it pertains to the socio-political landscape and security concerns and determined that “risk has sufficiently receded.” As a result, the company will welcome Trump back onto Facebook and Instagram.

The former president will be expected to comply with Meta’s user policies, but, considering his past violations, will face “heightened penalties for repeat offenses,” Clegg explained.

While it’s unclear whether Trump will become an active user on either platform following the decision, media and marketing experts are already sounding alarm bells at his potential return.

In particular, experts are cautious considering recent developments at Twitter. Elon Musk’s turbulent takeover – which has included mass layoffs, dramatic platform changes and the decision to reinstate the accounts of controversial figures like Trump and Kanye West (whose account has since been re-suspended) – has led to an exodus of advertisers. Could Meta’s decision to reintroduce Trump invite a similar fate?

‘Fear, frustration and protest’ could catalyze drawback

Concerns regarding brand safety and suitability on Facebook and Instagram are piquing among marketers. Trump’s presence on social media has long proven to exacerbate the spread of misinformation online. The risks of a potential recession, paired with new political tensions spurred by the 2022 midterms and the anticipation of the 2024 presidential election, may only up the ante.

“Misinformation on Meta’s platforms was an issue prior to Trump’s ban, during the ban and will likely continue to be an issue, even with the new [policies that] Meta has put in place,” says Laura Ries, group director of media and connections at IPG-owned ad agency R/GA. In light of this fact, Ries says, “Advertisers will need to continue to consider the type of content they’ll show up next to when evaluating whether or not to advertise on the platforms, especially as we march toward the 2024 election.”

She predicts that Meta may see some advertisers leave Facebook and Instagram “out of fear, frustration or protest.”

Others agree. “I suspect advertisers will not be pleased with this move and might make reductions in spend as they have done with Twitter,” says Tim Lim, a political strategist, PR consultant and partner at creative agency The Hooligans.

Although some advertisers are sure to pull back or cut their investments, the number will likely be low – largely because the scale and reach promised by both Facebook and Instagram will make it hard for most advertisers to quit. Smaller brands and startups in particular often rely heavily on Meta’s advertising business to spur growth, says Ries.

A ripple, not a wave

Most industry leaders believe Trump’s reinstatement won’t cause anything more than a ripple in the advertising industry. “Marketers who advertise on Facebook and Instagram care about their own problems, which generally [entail] selling more products and services,” says Joe Pulizzi, an entrepreneur, podcaster and author of various marketing books. “If Meta helps them do that, they don’t care one bit about brand safety – unless this blows up into a big political issue again. It might not, so marketers won’t do a thing.”

The sentiment is underscored by Dr Karen Freberg, a professor of strategic communications at University of Louisville, who says: “Facebook and Instagram are key fundamental platforms for advertisers. Marketers may … be aware of the news, but I am not sure if it will make a drastic change for the industry.” She points out that Twitter’s decision to lift the ban on Trump’s account in November caused such a big stir among marketers advertisers that Meta’s decision to do the same may come as less of a shock.

Trump’s return may even benefit Meta’s ads business by giving the company new opportunities to serve ads to Trump devotees, says Pulizzi. Ultimately, he says, Meta “needs personalities like Trump,” who, whether through love or hate, inspire higher engagement. “With Facebook plateauing and Instagram now chasing – and copying – TikTok at every turn, Trump’s follower base is important to Meta, which is hard to believe, but I think it’s true.”

But while some users may be energized by the former president’s return to Meta platforms, others may be outraged – even to the point of quitting Facebook and Instagram, points out Ries. In this case, she says, “advertisers will need to follow them to TikTok, Snap or other platforms where they’re spending their newfound time.”

R/GA, for its part, which services major brands including Google, Samsung, Verizon and Slack, will work on “a client by client basis” to address concerns about Facebook, Instagram or any other platform, says Ries. “R/GA recommended pausing activity on Facebook and Instagram after the insurrection and won’t hesitate to do so again if another incident occurs.”

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