DJI and the battle over data

Business & Technology

A story from the SupChina A.M. newsletter. Sign up for free here.

dji drones
Illustration for SupChina by Derek Zheng

Last Thursday, the Biden administration blacklisted the dronemaker DJI from receiving American investments. Meanwhile, some lawmakers and officials want to drive the product out of the U.S. market.

  • A measure moving through Congress would issue a five-year ban on federal purchases of all drones made in China, a direct swipe at DJI, which dominates over half the world’s drone market.
  • In October, Brendan Carr, a member of the Federal Communications Commissions, demanded a halt on agency purchases of DJI, calling the company “Huawei on wings.”
  • DJI has become a metonym for America’s fears that Beijing may have access to reams of sensitive data from its private companies. “DJI drones collect troves of sensitive data, from images of U.S. critical infrastructure to sensing body temp & heart rates,” Carr wrote in a Twitter thread.

The blacklist inclusion and potential ban are a continuation of Trump-era policies. Last December, the Trump administration barred U.S. manufacturers from supplying parts to DJI over its ties to the military and human rights abuses.

  • Last month, former Deputy National Security Adviser Matt Pottinger pushed the Biden administration for a harder line on data in an op-ed in the New York Times. He wrote, “Will American and allied policy makers develop approaches to limit strategic data flows to China? For now, the Biden administration’s answer is: maybe.”
  • Critics of the latest policies argue that Americans face plenty of bigger threats to the privacy of their data back at home. DJI has testified in Congress that it does not send any information from drones in the U.S. back to China and users can completely disconnect DJI drones from the internet.
  • DJI is no less complicit in Beijing’s abuses in Xinjiang, critics add, than Apple is to any of the United States’ illicit behaviors.
  • Dan Wang, an analyst at Gavekal Dragonomics, has argued that ham-fisted prohibitions without evidence may actually push private Chinese companies — which once depended on American consumers — further into Beijing’s fold.

Data security is quickly becoming a defining issue of our era. As governments focus more on the regulation of data, with ever more emphasis on national security, the result, according to Paul Triolo of Eurasia Group, is a complete bifurcation of the internet, with democratic and authoritarian worlds operating with different standards and companies forced to choose sides.

Business in the morning.

It only takes two minutes each day to stay tapped in to the world’s second largest economy. Sign up for Tipsheet, delivered to your inbox for free at 9am ET daily.