The unholy alliance between Big Tech and China goes far beyond TikTok, which recently reached a deal to survive in the U.S. by divesting its American operations from non-Chinese ownership. Even American-owned tech giants are deep under the covers with the Chinese, as evidenced by a new Reuters report that examines the relationship between Facebook's parent company Meta and China. The report concludes that Meta takes in billions in ad revenue from China while only loosely policing fraud and other illegal content in those ads.
The report finds Meta took in $18 billion in advertising revenues from China last year, more than one-tenth of its total global revenue. Of that $18 billion, more than $3 billion was flagged for scams or illegal content like gambling and pornography, according to Meta's own calculations.
China experts warn this marriage of Big Tech and the Chinese has been growing for years, and is only getting more dangerous. "Number one, China is disseminating propaganda, and now China is getting into the scam business," says Antonio Graceffo, economic analyst with the China Econ Group. "And the American Big Tech and social media companies are enabling this, even though they are banned in China."
Indeed, Meta's billions in ad business with China comes in spite of the fact that Facebook remains banned for the Chinese public, notwithstanding years-long efforts by the company to get that ban lifted.
As for all the scams and fraud, Meta had a dedicated Chinese anti-fraud unit but disbanded it last year in lieu of a broader focus on fraud. A Meta spokesman told Reuters their automated systems have removed millions of illegal ads from China before users ever saw them.
But as long as the ads are coming, the scams and fraud will come with them. "We really need to ban the money (from China) altogether," says Graceffo. "I don't think you can police it, because you really can't separate individual companies from the Chinese Communist Party."
"I've worked in Southeast Asia, and there are these Chinese scam centers all over the country," he continues. "And this is becoming the new model, that you earn a higher profit margin by scamming than you do by producing products and services."
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