ByteDance is setting up a second corporate entity in India, as the Chinese multinational internet technology company looks to deepen its roots in Asia’s third-largest economy, among its most active markets globally.
The new entity, according to two sources with knowledge of the developments, is likely to provide Information Technology and IT-enabled services support to all of ByteDance’s platforms worldwide, including in India.
It will also include working on content generated across its various platforms, issues that the world’s most richly valued startup has been facing across geographies.
An email sent to ByteDance spokespersons in India, on Saturday evening, did not elicit any response at the time of going to press.
The Beijing-headquartered company, which commands a secondary private market valuation of about $110 billion, owns and operates popular short-form mobile video app TikTok and social media platform Helo apps. It also has content discovery platform Toutiao and Douyin, the Chinese twin of TikTok, as well as Xigua Video, among others in its portfolio.
Sources said ByteDance was expected to formally file an application with the government and regulators, including the Department for Promotion of Industry and Internal Trade in the next few weeks.
Currently, it operates as ByteDance India Services Ltd in the country.
“There will be data and technology transfer into India with ByteDance looking to ramp up its workforce in India, a market where the company will look to create a centre of excellence over the near-term,” one of the sources said.
As of November 2019, ByteDance had a workforce of over 60,000 worldwide, with 15 research and development centres.
The move towards a second corporate entity comes at a time when ByteDance, which counts the likes of SoftBank, General Atlantic, Sequoia Capital China, KKR and Hillhouse Capital among its investors, has been fighting accusations related to national security risk and handling of personal data across its various markets, including India.
India has been the biggest driver of TikTok installs, generating 611 million lifetime downloads to date, or 30.3% of the total, according to a report published by Sensor Tower Store Intelligence in April.
TikTok, a short video app with special effects, has been downloaded more than 2 billion times globally on the App Store and Google Play, it said.
Last month, however, ET reported that in India, fewer people downloaded it in April and May compared to the previous two months, amid reduced marketing and advertising budgets due to the Covid-19 pandemic, along with a persistent anti-China sentiment that saw users calling for a ban.
Additionally, Reuters reported citing sources that ByteDance had begun to transfer global decision-making and research capabilities out of its home country, which included its non-China focused businesses.