Why TikTok moving to the UK will create an opportunity for a 'global Britain' as the hub for tech firms.

Back in 2010, the five biggest public companies in the world included two oil firms and a bank. Now all five are tech companies, and the largest – Apple – is worth nearly five times as much as the biggest firm ten years ago. The sixth and seventh biggest companies are both Chinese and both tech firms.

This is the real story behind the rise of the social platform TikTok and its parent company ByteDance, who is widely rumoured to be considering London as their global head office.

Tech firms are driving investment returns, and Asian firms are increasingly powerful leaders in the sector.

Much more unusual is that ByteDance is a global giant which sees its future in moving from Asia to the West, not the other way around. They could prove to be the start of a trend.

Our unique polyculture of world class creative and tech industries is a good fit for the platform

In truth, it is easy to see why ByteDance might be looking to the UK for their long-term future. Our unique polyculture of world-class creative and tech industries is a good fit for the platform, and we can contribute high finance, smart regulation and an early adopter consumer base.

But let’s not underestimate the size of this opportunity for a new Global Britain either. For those of us addicted to Twitter it might seem surprising, but TikTok has more than twice as many users and could cost twice as much to buy. In recent years we have seen strategic investments in our technology scene from Google and Facebook, but this is something quite different – a tech giant choosing London for its global headquarters.

That is why it was important that ByteDance not be caught up in wider uncertainty about the Chinese trading relationship.

Governments are having to manage complex issues weighing economic growth against national security. But it would be wrong to view all Chinese companies though a Huawei-tinted lens. ByteDance is owned outside of China, with an investor group and board of directors drawn from experienced Western tech investors. They run a social media app, not strategic infrastructure. And their data is stored in the US and Singapore, not in China. This is not a company owned or led by the Chinese government in any way.

Of course, there are challenges for policymakers to grapple with. Social media innovation has often run ahead of data security law, and ByteDance has a responsibility to give society confidence that they are treating customers’ data safely. Inevitably they will also need to prove that there are no grounds on which that data finds its way to the Chinese Government.

Given their customer demographic ByteDance will also have to take a leadership role in protecting younger people on these emerging platforms. If regulators struggle to keep up with the pace of innovation, parents certainly do.

These are not trivial issues, but they are with us for the long term as a simple fact of modern technology. The question is what society does about it, and whether the UK wants to assume a leadership role in shaping the answers. The rules which underpinned 19th and 20th-century globalisation were written in London and Edinburgh. We can have the same impact defining the rules for the new economy too.

The UK has a world-class data regulator which has adopted the sandbox model for developing new regulation alongside new innovation, rather than in desperate catchup.

These apps are an important part of the creative and social lives of many of us. There really isn’t any question about whether they are here to stay. But our ability to guide them as they mature is far greater if we can make ourselves a global hub.

It matters a great deal that we get this right. Each company has to be judged on its own terms, balancing security, consumer and competitive risks.

We could help build a global Britain by attracting these firms

There is a generation of innovation rich companies in Asia who look to the West as their natural market. We could help build a global Britain by attracting these firms. Chemistry innovators to the Manchester tech cluster. Biotech to Cambridge. Social platforms to London. But they will be looking to see how the West welcomes ByteDance.

There is almost nothing we could do to kickstart Global Britain more effectively than be robust, challenging but welcoming hosts.

Published in Evening Standard, Wednesday 5th August 2020

https://www.standard.co.uk/comment/comment/brent-hoberman-tiktok-global-britain-a4517331.html