TikTok owner ByteDance’s chief warns against mediocrity as AI disrupts

ByteDance CEO Liang Rubo warned employees at a company-wide meeting on Tuesday that the TikTok owner risks becoming complacent and slipping into mediocrity as it faces challenges from newer startups.

At a meeting in Singapore watched by ByteDance employees worldwide, Liang said the company’s rapid expansion in recent years had made it less efficient, and it had not paid enough attention to artificial intelligence technology, according to a ByteDance post about the meeting on social media.

“Our company is not sensitive enough (to new technologies),” Liang said. “For example, discussions about GPT did not appear in our half-year tech review until 2023, although GPT-1 was already released in 2018.”

GPT refers to a machine learning technique that has given OpenAI’s ChatGPT chatbot human-like accuracy.

ByteDance is often seen as the world’s leading company on algorithms because its flagship apps such as TikTok, Douyin and Toutiao are powered by commanding recommendation engines.

But the company, nicknamed “App Factory” due to its frequent releases of mobile applications, has been slow to the AI race that is disrupting the technology sector.

Other Chinese tech tycoons ranging from JD.com founder Richard Liu to Tencent Chairman Pony Ma are also now calling on their companies to be more efficient and refrain from becoming complacent.

Highlighting ByteDance’ late start on AI foundation models, Liang said the companies with better models created them between 2018 and 2021.

“For many good startup teams, they are very familiar with the industry. They can quickly spot any new projects appearing on GitHub, and then they start seeking acquisition or partnership opportunities,” he said, referring to the online depository for computer codes.

Liang added ByteDance was suffering from too much internal red tape as the company expanded, with it now taking six months to work on projects that a startup could complete in one month.

ByteDance has recently increased its focus on AI while pulling the plug on some businesses such as video games. The company has been testing a number of AI-powered chatbots such as “Doubao” in China and “Cici” and “ChitChop” overseas.

ByteDance’s AI strategy came under scrutiny last month after media outlet The Verge reported that it had used OpenAI’s technology to develop its own AI.

While ByteDance said its use of OpenAI’s service was legal, OpenAI suspended ByteDance’s account pending an investigation.