In just two months, the Clubhouse became the place of choice for luminaries like Elon Musk or Drake to exhibit everything from telepathic monkeys to stock market valuations. But the real winner of the stratospheric rise of the audio chat app is a loss-making startup in Shanghai called Agora Inc.
Now, known primarily in technology circles as a diligent but discreet supplier of software tools, it has increased by more than 150% since mid-January, when online conversations began to circulate about how he powers the world’s hottest social media forum . That’s because the little-known company – now valued at nearly $ 10 billion – provides developers with everything they need to build real-time voice and video functions within applications: a model known as a software development kit.
Now – ancient Greek for a forum or marketplace – has been publicly linked to the Clubhouse since its IPO last summer, although it remains unclear to what extent the fervent social media forum employed its software kit. Decompiling the Clubhouse app reveals Agora’s name in the code, meaning that the Clubhouse is using at least part of the Chinese company’s SDK, according to two engineers familiar with the matter, who asked not to be identified because they disassembled the code from the software violates Apple’s iOS user policies.
Clubhouse co-founders Paul Davison and Rohan Seth said in in-app conversations that they use Agora, according to two people who heard these discussions, but asked not to be identified because the Clubhouse does not speak publicly about its stack of technology. And in an experiment this week, German software engineer Andreas Lehr told Bloomberg News that he analyzed the traffic coming out of his phone while connected to the Clubhouse and noticed several calls to agora.io.
In addition to just increasing the stock price of Agora, however, this amorphous link is starting to raise concerns about the security of the app. It is the same vague fear that connects with the biggest companies, from ByteDance Ltd., owner of TikTok, to unpublished clothes: that Beijing has the power not only to demand that they deliver data at will, but also to force Chinese companies to spy on your name. Now he declined to comment on his relationship with the Clubhouse, but said in a statement that he takes privacy and security seriously.
“As in the case of Zoom, Agora still runs its centralized service in different jurisdictions,” said Suji Yan, founder and CEO of data privacy startup Mask Network, which builds a tool for users to post encrypted messages to Twitter and The Facebook. “It is difficult for a public company like Agora not to respond to a request from a local government.”
The debate over the extent of Agora’s involvement comes even when Beijing appears to be moving against the Clubhouse. Many of the app’s users in China say they haven’t been able to access the service since Monday, after an explosion of weekend discussions over taboo topics from Taiwan to Xinjiang.
But it is the potential for surveillance that concerns international users. Chinese law requires that its companies provide information upon request and even collect data on behalf of Beijing, if this is considered to be in the national security interest. This, along with accusations by U.S. lawmakers that Chinese companies can build backdoors on devices and software for the Communist Party can exploit, is at the heart of growing hostility against China’s biggest technology suppliers.
Agora’s own customizable tools run on users’ devices as part of client applications like Clubhouse. Agora co-founder Tony Wang told the media that the company does not store any end user data, but serves as a “pass-over”. But from a technical perspective, it obtains voice data in real time that it helps to transmit in the Clubhouse. It will not be possible to cross the identification with the users’ cell phone numbers – which in turn reveals their identities in the real world – because such data is managed by the Clubhouse itself, according to the two engineers familiar with the subject.
In theory, Chinese operatives can compare Agora’s voice data with other voice data that connects with real identities – for example, those of state-owned Chinese telecom operators – as a way of identifying activists or dissidents, Mask Network said . Yan.
“At the moment, I don’t think the government would have the computing power to do that, but you cannot rule out that possibility in the future,” said Yan. “And cross-referencing voice data linked to the same cell number will leak more data and cause more potential problems than we thought.”
Started in 2013 by software engineer Tony Zhao, Agora has grown to become one of China’s largest real-time communication technology providers, empowering big names such as the teaching service provider New Oriental Education & Technology Group and the application operator The Meeting Group dating site. It attracted investments from venture capital firms, including GIS, Coatue Management and China’s Morningside, which is also one of the first to support the short video application Kuaishou Technology.
Revenue grew 81% to $ 30.8 million in the September quarter, when companies outside China contributed more than 20% of sales, executives told analysts during a post-profit call in November.
Agora itself highlighted China’s complex Internet regulatory regime as a risk factor in its IPO prospectus, adding that it may be necessary to take further steps to comply with the European Union’s GDPR privacy laws or regulations elsewhere. It currently offers products in more than 100 countries.
Still, speculation about the Clubhouse’s Chinese roots hasn’t hurt its global popularity yet, nor have Beijing’s actions.
“The Chinese discussions I heard last week were remarkable, as they touched on strongly censored issues in China, while allowing open discussion across the Chinese border,” said Graham Webster of the Stanford University Cyber Policy Center.
(Except for the title, this story was not edited by the NDTV team and is published from a syndicated feed.)