TikTok signs Trump-backed deal to avoid US ban | TikTok
TikTok has agreed to form a joint venture that will allow it to continue operating in the United States, five years after Donald Trump threatened to ban the social media platform over privacy and national security concerns, a move that further strained relations with China.
TikTok’s Chinese owner ByteDance has signed a deal with Larry Ellison’s Oracle, private equity group Silver Lake and Abu Dhabi’s MGX that will allow it to retain control of its core US operations.
According to the agreement, the joint venture will take over some of TikTok’s business in the US, including data protection, algorithm security and content moderation.
But Shou Zi Chew, TikTok’s chief executive, said in a memo to employees that ByteDance will continue to run its U.S. operations, including its key revenue drivers such as e-commerce, advertising and marketing.
The deal ends five years of uncertainty about TikTok’s future in the United States, where the platform has more than 130 million users.
In 2020, during his first term as president, Trump issued an executive order threatening to ban the service in order to “protect the national security of the United States.”
The United States, which ordered ByteDance to sell TikTok’s US business, accused the platform of serving as a tool for the Chinese government to collect data from American users. The company has consistently denied the allegations.
During Joe Biden’s administration, Congress passed a law banning ByteDance from maintaining operational ties with TikTok USA. But the national security law gave the US president the authority to decide whether any agreement meets its requirements.
Trump approves joint venture that will control TikTok’s business in the US.
Under the new structure, Oracle, Silver Lake and MGX will each hold 15% shares. Existing ByteDance investors will own 30.1%, while ByteDance will own 19.9%; this is the maximum amount allowed under U.S. foreign ownership laws. The remaining 5% will be in the hands of new investors whose names have not been announced yet.
The U.S. joint venture will be overseen by a seven-member board of directors, the majority of which will be Americans, according to Chew’s staff memo.
“Upon closing, the US joint venture, built on the foundation of the existing TikTok US Data Security (USDS) organization, will operate as an independent entity with authority over US data protection, algorithm security, content moderation and software assurance,” he added.
In September, the Trump administration announced that a framework agreement had been reached after progress was made in negotiations between US and Chinese officials.
US vice president J.D. Vance said at the time that the deal would value TikTok’s US joint venture at $14 billion.
Under the agreement, Oracle will control the algorithm that recommends videos to US users. Chew’s note states that the system will be retrained using US data to “ensure the flow of content is free from outside manipulation.”
China will retain control of the algorithm, and the country’s cybersecurity regulator has previously said it accepts that any TikTok US deal would involve “licensing… and other intellectual property rights.”
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The deal is expected to be completed on January 22, one day before Trump’s deadline; otherwise it would result in the app being banned in the US.
Ellison’s role in the new ownership of the most popular social media platform in the United States has raised concerns about the shrinking share of media companies not controlled by pro-Trump billionaires.
Ellison’s son David is leading radical changes at CBS; Mark Zuckerberg controls Instagram and Facebook; Jeff Bezos owns the Washington Post. X is controlled by Elon Musk, who briefly collaborated with Trump before a public row this year.
“First Paramount/CBS and now TikTok,” said Elizabeth Warren, a Democratic senator from Massachusetts. wrote on Bluesky in response to the news. “Trump wants to cede more control over what you watch to his billionaire friends.
“Americans deserve to know if the president made another backdoor deal for this billionaire to take over TikTok.”
