TikTok’s chief executive told employees today that the company has signed agreements that will ensure it can continue operating in the U.S.
In a memo, TikTok’s chief executive, Shou Zi Chew, said that parent company ByteDance Ltd. and TikTok have signed binding agreements. Oracle Inc., private equity firm Silver Lake Partners LP, and Emirati-backed investment firm MGX will together own 50% of the U.S. business. Close to 30% of the joint venture will be held by “affiliates of certain existing investors in ByteDance,” and ByteDance will retain 19.9%.
The deal is expected to close Jan. 22. “We have signed agreements with investors regarding a new TikTok U.S. joint venture, enabling over 170 million Americans to continue discovering a world of endless possibilities as part of a vital global community,” Chew wrote in the memo.
The deal follows years of doubt cast over TikTok regarding how much data from its now-170+ American users its owners share with the Chinese Communist Party. A law was passed last year under the Biden administration that demanded the U.S. version of the app be spun off or face a ban in the U.S. President Trump repeatedly delayed the deadline until a deal could be finalized.
In September, Trump said he’d spoken with China’s President Xi Jinping over the phone about the deal and that “he gave us the go ahead.” At the time, critics aired concern that the new owners would be overly MAGA-friendly – Oracle Chief Executive Larry Ellison is a political ally of Trump. Trump responded, assuring the public that the new TikTok would be bipartisan. “Everyone is going to be treated fairly, every group, every philosophy,” he said.
Under the plan, the new entity will retrain TikTok’s algorithm using U.S. user data, which, the memo states, will “ensure the content feed is free from outside manipulation.” Oracle will supervise the storage of Americans’ information, consistent with earlier White House statements. The joint venture will also take charge of content moderation for U.S. users, although Chew’s memo states that the ByteDance-run global TikTok organization will retain control of e-commerce, advertising, and marketing on the U.S. platform.
Image: Unsplash
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