ByteDance launches Volcano Engine brand to offer TikTok 'secret' to businesses

Volcano Engine has been already operating for a year and has clients as JD.com, Vivo and Geely

  
People walk past the Bytedance headquarters building in Beijing, China August 3, 2020.

People walk past the Bytedance headquarters building in Beijing, China August 3, 2020.

REUTERS/Carlos Garcia Rawlins

BEIJING - TikTok owner ByteDance launched the Volcano Engine brand on Thursday to offer its personalised recommendation algorithm to more corporate clients, as the Chinese company seeks to expand beyond its mainstay consumer apps.

ByteDance's recommendation system is considered the "secret sauce" in its success with apps including TikTok, TikTok's Chinese version Douyin, and news aggregator Toutiao.

It was also one of the focal points when ByteDance was forced into talks to sell part of TikTok's U.S operations last year following former President Donald Trump's executive order.

China at the time revised its export restrictions so it would have a say over the potential transfer of TikTok's recommendation algorithm to foreign buyers.

U.S. President Joe Biden on Wednesday revoked the Trump order and ordered a new review of security concerns posed by Chinese apps.

ByteDance said in a statement that Volcano Engine would offer enterprise clients technologies such as a recommendation algorithm, data analysis and artificial intelligence.

It said Volcano Engine had already been operating for a year before Thursday's official launch, and had corporate clients such as e-commerce giant JD.com, smartphone maker Vivo and automaker Geely.

It also plans to add public cloud computing services, an already immensely competitive sector dominated by big tech companies in China such as Alibaba, Tencent and Huawei, a source close to the matter said.

ByteDance declined to comment on the cloud services plan.

The bulk of ByteDance's revenue comes from consumer-facing products such as Douyin and Toutiao. With growth prospects for these businesses likely to weaken as they mature, ByteDance has been seeking to make inroads in new areas such as enterprise services.

The company also operates work-collaboration tool Lark and its Chinese version Feishu.

(Reporting by Yingzhi Yang and Tony Munroe in Beijing. Editing by Miyoung Kim and Mark Potter) ((Yingzhi.Yang@thomsonreuters.com; +861056692133;))

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