How a China-backed app is beating Bytedance in US news market

This article is co-written by Minghe Hu.

Bytedance has a reason for the reported sale of its news aggregation app TopBuzz: it is losing out to a much smaller rival with Chinese roots – Particle Media’s News Break – which is being downloaded more than CNN and Reddit, according to current US app store rankings.

Photo credit: Bytedance

The Chinese owner of global hit TikTok might have earned its entertainment spurs in the US with the short-video app’s burgeoning popularity there, but the more mature news business is proving to be a totally different story.

News Break was the most downloaded Android news app in the US from January to September, and ranked second on Apple’s App Store, behind Twitter. In comparison, Bytedance’s TopBuzz, which uses machine learning similar to TikTok’s to recommend content, ranked below 20. News Republic, the other news product Bytedance owns through a 2017 acquisition, came even lower on the list, around 100th, according to mobile intelligence firm Sensor Tower.

Beijing-based Bytedance is best known for its consumer-oriented algorithms that are designed to increase user stickiness through smart content recommendations. Particle Media said it takes a slightly different approach, with an “interest engine” that integrates search records and recommendation technologies. However, Bytedance’s apps also allow users to actively search and follow the accounts they like.

In short, both news aggregation apps provide a more personalized news reading experience – but “David” is beating “Goliath” in this case. One challenge that both Chinese-backed news aggregators have to face though is the rising tech war between the US and China.

TikTok has recently been tackled in the US over censorship and security concerns by senior figures including Facebook chief executive Mark Zuckerberg and US senators Chuck Schumer, Tom Cotton, and Marco Rubio. Bytedance has denied it censors overseas content at the behest of the Chinese government.

One key difference between China and the US markets is that users in the latter tend to rely on renowned news organizations, while individual content makers are much more active in China, said Jerry Liu, co-head of China internet research at UBS.

“Some apps appear high up on the overseas rankings, but it might be the result of rampant marketing. It takes another one or two years before the real survivors stand out,” added Liu.

Nevertheless, many Chinese internet companies doing business in the US have tried to distance themselves from their roots and have focused instead on improving user experience and product quality, according to Liu.

The slowing dynamics of the Chinese internet scene have prodded some local companies to expand overseas – and they often have an innovation edge because of fierce competition at home, which has forced them to evolve rapidly. In September, the growth of monthly active internet users in China slowed to 1.3%, compared with 6.2% in January 2018, according to analytics firm QuestMobile.

But technological innovation is not necessarily top of the list for US news consumers.

Tabatha Armstrong, an Alabama resident who has used both apps, said News Break gives her all the local information “that does impact her life,” while TopBuzz “mostly reports on celebrities.”