TikTok, the popular Chinese video app with 170 million US users, is facing an uncertain future in the United States. A potential second chance at dominance may arise from a new lease on life.
The Fate of TikTok in the US: A Constantly Evolving Saga
TikTok, a popular Chinese video app with 170 million US users, is facing an uncertain future in the United States. The app’s owner, ByteDance, has been under pressure to sell its US operations due to national security concerns and data privacy issues.
TikTok is a social media app that allows users to create and share short-form videos.
Launched in China in 2016 under the name Douyin, it has since become one of the fastest-growing social media platforms globally.
As of 2022, TikTok has over a billion active users worldwide.
The platform's algorithm focuses on user engagement, using AI to learn users' preferences and serve them content accordingly.
The Law That Could Change Everything
The federal law that targets ‘foreign adversary controlled applications’ specifically mentions TikTok and ByteDance. This definition means that no more than 20% of the company can be owned by individuals or companies in a country listed as a ‘foreign adversary’ — a title the US has bestowed on China.
A Deadline Extended, but Not Evaded
The law gave ByteDance until January 19, 2025, to sell its US-based business. The deadline was upheld by the Supreme Court and was one day before Donald Trump‘s second inauguration. However, just one day earlier, on Friday, April 4, Trump pushed the deadline again, allowing 75 more days to find a solution.
Who Owns TikTok?
TikTok is a subsidiary of privately held ByteDance. According to numbers published by TikTok, roughly 60% of ByteDance is owned by global institutional investors. Another 20% is owned by the company’s founder and 20% by ByteDance employees. The biggest outside investor is Pennsylvania-based trading and technology firm Susquehanna International Group, which now has 15% of the company.
Rumors of Potential Investors
Rumors have been flying of possible suitors and last-minute offers to take over TikTok‘s US business. Some potential investors include ‘Amazon,’ ‘Microsoft,’ artificial intelligence startup ‘Perplexity AI,’ venture capital firm ‘Andreesen Horowitz,’ and a group headed by billionaire businessmen ‘Frank McCourt.’ Private equity firm ‘Blackstone Group’ has also been mentioned.
Oracle: The Most Likely Candidate
Perhaps the most likely candidate to steer a takeover is Oracle. The company is already involved with TikTok and showed interest in the company during Trump‘s first term. Since 2020, Oracle has been keeping US user data on domestic servers. Many assume the company will retain an operation role at the very least should the company continue to operate in the US.
What Does Trump Want from China?
It is hard to put a price tag on TikTok since there are so many factors and unknowns right now, especially if the app’s algorithm is not part of the sale. Any new ownership structure with a bigger proportion of US investors would reduce the ownership stake of Chinese investors and avoid a full-fledged sale.
In the end, it will be a question of price, US government pressure, and Chinese acceptance of the deal. The president has said that tariff negotiations could be part of the deal. Trump has already hit Chinese imports with tariff duties totaling 54%. If China let a sale go ahead, he may reduce tariffs or hold back on implementing higher ones.
If a sale doesn’t come together in the next 75 days, the ban could go into effect and TikTok could go dark for millions of US users.
