Seeing Like An Algorithm
In this second installment of a three-part series about some of the features that make TikTok successful (the first article was highlighted in the Aug. 18 edition of Beach Reads), Eugene Wei delves into the "magic" of the TikTok algorithm by illustrating how the app's design actually empowers the artificial intelligence (AI). Features on TikTok's For You Page (FYP) such as swiping to indicate pleasure or displeasure (much like Tinder) help TikTok's "machine learning FYP algorithm 'see' what it needs to see to do its job so effectively," Wei says. "An algorithm-friendly design ethos may become a model of how other companies in other verticals might achieve an edge in the age of machine learning." TikTok, Wei argues, creates network effects that are missed by other apps by effectively integrating the AI with the user interface (UI) to help power algorithmic development and user engagement. "Most software features or UI designs can be copied easily by an incumbent or competitor overnight," he writes. "But if you can create a flywheel, like TikTok's, it becomes much harder for a competitor like Reels or Triller to catch up. Triller may pay some influencers from TikTok to come over and make videos there, Reels might try to draft off of existing Instagram traffic, but what makes TikTok work is the entire positive feedback loop connecting creators, videos, and viewers via the FYP algorithm." While others focus on building a moat via advantages in scale or technology, TikTok does so by delighting customers (not far off what Sarah Tavel describes in her article in the Investment Philosophy section below), and I'm looking forward to Wei's insights on this approach in a further follow-up on the "network effects of creativity."