The proposed plan involves spinning off TikTok’s U.S. operations into a separate entity and reducing Chinese ownership in the new business to below the 20% threshold required by U.S. law. This move would rescue the popular short video app from a looming ban in the United States.
Key Players in the Deal
Leading the discussions with the White House are Jeff Yass’ Susquehanna International Group and Bill Ford’s General Atlantic, both of which are represented on ByteDance’s board. Private equity firm KKR is also participating in the talks, according to one of the sources.
The plan would see Oracle, which already hosts TikTok’s U.S. user data, continue to provide data storage and ensure that the data remains inaccessible from China.
Background: The TikTok Ban
TikTok’s fate has been uncertain since a U.S. law took effect on January 19, requiring ByteDance to either sell the app or face a ban on national security grounds. The law, passed with bipartisan support, reflects concerns that TikTok’s Chinese ownership could allow Beijing to use the app for influence operations against the United States.
TikTok has denied these allegations, stating that its content recommendation engine and user data are stored in the U.S. on Oracle’s cloud servers, with content moderation decisions for American users also made domestically.
Legal and Political Challenges
Free speech advocates have argued that the ban threatens to restrict Americans’ access to foreign media, potentially violating the First Amendment of the U.S. Constitution. Meanwhile, former President Donald Trump, who initially supported the ban, has since pledged to “save TikTok” and keep the app operational in the U.S.
Trump issued an executive order shortly after taking office, postponing enforcement of the ban until April 5, and has hinted at further extensions to facilitate a deal.
Ownership Structure
According to legal filings from TikTok last year, global investors own about 58% of ByteDance, while its Singapore-based Chinese founder, Zhang Yiming, owns 21%. The remaining 21% is held by employees of various nationalities, including approximately 7,000 Americans.
Competing Bids
Other groups vying to acquire TikTok include a consortium led by billionaire Frank McCourt and another involving YouTube star Jimmy Donaldson, better known as Mr. Beast.
A Landmark Deal
The White House has played an unprecedented role in the negotiations, effectively acting as an investment bank to broker a deal. Under the proposed agreement, ByteDance would retain a stake in TikTok, but data collection and software updates would be overseen by Oracle, which already supports TikTok’s infrastructure under an arrangement negotiated during Trump’s first term.
What’s Next?
As discussions continue, the outcome of these talks will determine whether TikTok remains accessible to its nearly 150 million U.S. users or faces a ban that could reshape the social media landscape.