Tiktok, owned by Chinese company Bytedance, has been at the heart of US controversy for four years due to concerns about user data that the Chinese government may access.
As a result, US users often find themselves caught up in the midst of this tension. Earlier this year, the app experienced a temporary suspension in the US, leaving millions of users suspense before it was quickly restored. Tiktok returned to the App Store and Google Play Store in February.
Many investors are competing for opportunities to buy apps, and if a transaction occurs, the platform’s US business could rise to over $60 billion, as estimated by Angelo Zino, senior vice president at CFRA Research.
After extensive debate, it appears that progress has been made after Trump extended the fourth Tiktok ban period. Last week, President Trump announced that President XI of China had given approval to the Tiktok contract. This allows a consortium of US investors to manage the platform. The ordinance publicly stated that it ensures that the platform is made available to American users.
Who will take ownership of the US Tiktok?
Recently, a “framework” deal has been reportedly established between the US and China, revealing new information, indicating that a consortium of investors, including Oracle, Silver Lake and Andreessen Horowitz, could oversee Tiktok’s US operations.
These investors are expected to hold 80% of the shares, with the remaining shares belonging to Chinese stakeholders. The new entity’s board of directors is primarily made up of US members, with one member appointed by the US government.
Over the weekend, Trump said in an interview with Fox that Rupert Murdoch and his son Lachlan would “probably” play a role alongside Oracle’s executive chairman Larry Ellison and Dell Technologies CEO Michael Dell.
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Oracle may handle the security and security measures of your app. Oracle bids for Tiktok in 2020, as the company already offers cloud services to Tiktok and manages user data, particularly in the US.
Additionally, as part of the proposed arrangement, Oracle will replicate and secure the new US version of the algorithm, according to White House officials. The US-based Tiktok owners can lease the algorithm from bytedance, and then Oracle retrains.
Bytedance has no access to information about Tiktok’s US users or its impact on US algorithms.
What US users need to know
Reports from Bloomberg show that once the transaction is completed, the Tiktok app will be cancelled in the US, indicating that users will need to migrate to the new platform. However, details about this platform remain largely unknown, such as its functionality and how it differs from the original app.
How did you get here?
To fully understand this high-stakes drama, we first revisited the timeline of Tiktok’s turbulent relationship with the US government, bringing various legal battles and negotiations.
The drama first began in August 2020, when Trump signed an executive order to ban dealing with the parent company’s deadline.
A month later, Trump’s administration attempted to force a US-based company to sell Tiktok’s US operations. Key candidates included Microsoft, Oracle and Walmart. However, US judges temporarily blocked Trump’s executive orders, allowing Tiktok to continue operations while legal battles unfold.
Following the transition to the Biden administration, last year began to go further. After the Senate passed the bill against Tiktok, President Joe Biden signed it.
In response, Tiktok sued the US government, challenging the totality of the ban, claiming that the app and its American users were violating the initial right to amend. The company consistently denies that data stored in the US poses a security threat, as it claims to comply with all local laws.
Fast forward to today: Trump has had a change of heart since his first term, seeking to achieve a 50-50 ownership arrangement between the ordinance and the US company.
There were several candidates, including people’s bids for Tiktok, a consortium hosted by Project Liberty founder Frank McCourt. The group is supported by investment firm Guggenheim Securities and law firm Kirkland & Ellis. Supporters include Reddit co-founder Alexis Ohanian, TV Personality and Investor Kevin O’Leary, inventor of World Wide Web Tim Berners-Lee, and senior research scientist David Clark.
Another group, called the American Investor Consortium, is led by Employer.com founder Jesse Tinsley and includes Roblox co-founder David Baszucki, Anchorage Digital co-founder Nathan McCauley, and renowned Youtuber Mrbeast.
Other running include Amazon, Applovin, Microsoft, Perplexity AI, Rumble, Walmart, Zoop, former Activision CEO Bobby Kotick and former U.S. Treasury Secretary Steven Mnuchin.
The story was updated after it was published.
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