At a Glance
- TikTok has finalized a joint-venture deal to keep the app alive in the U.S. after a looming ban.
- The new U.S. entity will license ByteDance’s algorithm and retrain it on American data.
- Ownership ties to former President Trump and Oracle founder raise concerns about content moderation.
- Why it matters: U.S. users can continue using TikTok, but the platform’s future content and security posture remain uncertain.
TikTok’s U.S. future is finally in the clear, but the deal leaves many questions unanswered. The platform will continue to operate under a new joint-venture, with U.S. investors including Oracle, Silver Lake and MGX. The agreement, announced by TikTok’s leadership, was designed to satisfy a law that would have shut the app down by January 2025 if a new owner was not found.
The Deal and Its Origins
The law passed with bipartisan support and was signed by President Joe Biden. TikTok was slated to go dark on the January 2025 deadline, and for several hours it did. President Donald Trump countered with an executive order to keep the platform running while his administration negotiated a sale. A series of orders extended the deadline until the current deal was reached.
The new U.S. joint-venture will license ByteDance’s algorithm and retrain it using U.S. user data. This retraining is expected to subtly alter personalized feeds, according to eMarketer analyst Jasmine Enberg. Forrester analyst Kelsey Chickering noted that the algorithm’s “heartbeat” will become distinctly American, potentially changing the mix of global content that appears.
Ownership and Political Ties
The ownership group includes Oracle co-founder Larry Ellison, who, despite stepping down as CEO, remains a top executive and has an estimated personal fortune of $225 billion. Ellison’s ties to the Trump administration date back to the president’s first term, when he helped pressure ByteDance to sell TikTok.
These connections have sparked concerns about content moderation. Chickering warned that if moderation “tilts toward one political viewpoint or fails to curb misinformation, TikTok risks a user exodus to rival platforms.”
Vice President JD Vance, who led the White House’s effort to find a U.S. buyer, was involved in negotiating meetings with Chinese officials in Madrid in September. Trump’s executive order that same month allowed TikTok to continue operating.
What It Means for Users
American TikTok users can keep using the same app. The algorithm will be retrained, which could change the ordering of videos in feeds. The new Terms of Service state that users retain ownership of their content, but TikTok can use it to operate or improve the platform.
Users under 13 will see an “Under 13 Experience,” and all AI-generated content must be labeled as such. The deal does not fully address security concerns, as the law prohibits cooperation between ByteDance and a new U.S. owner on the content recommendation algorithm. How ByteDance’s continued licensing will play out remains unclear.
Creator and Business Reactions
Skip Chapman, who launched his deodorant business on TikTok in April 2023, said he is relieved the ban threat is over. He relies on TikTok shop for 80% of sales and hopes the new owners will continue to prioritize e-commerce features.
Vanessa Barreat, owner of a Las Vegas restaurant with over 100,000 followers, expressed a “wait-and-see” stance. She noted that TikTok has empowered voices that previously lacked platforms and that this impact will not disappear overnight.
The Bigger Picture
The deal represents a compromise between U.S. security concerns and the economic value TikTok brings. While the platform will remain accessible, the extent to which it can maintain its global reach and content diversity is uncertain. The new joint-venture’s relationship with ByteDance and the political ties of its owners could influence future moderation policies.
Key Takeaways
- TikTok’s U.S. operation continues under a new joint-venture.
- The algorithm will be retrained on American data, potentially altering feeds.
- Ownership ties to former President Trump raise moderation concerns.
- The deal does not fully resolve security worries about content recommendation.
- Creators and businesses feel relief but remain cautious about future changes.
