At a Glance
- TikTok announces a joint venture that could bring a majority stake in U.S. operations to non-Chinese investors.
- Over 80% of the new company will be owned by Oracle, MGX, Silver Lake, and Michael Dell.
- The venture will secure TikTok’s recommendation algorithm in Oracle’s U.S. cloud.
- Why it matters: The deal moves a long-running U.S. sale debate toward a concrete outcome.
A new entity, named TikTok USDS Joint Venture LLC, has been created to allow ByteDance to sell a majority stake in the U.S. operations of TikTok to a group of investors outside of China. The announcement follows years of uncertainty over whether the app would be banned in the U.S., and it moves a deal one step closer to completion.
Joint Venture Structure
The press release from TikTok states that the new joint venture will retrain, test, and update the content recommendation algorithm on U.S. user data. The algorithm will be secured in Oracle’s U.S. cloud environment. While the exact technical details are unclear, the move signals a shift toward greater U.S. control over TikTok’s core recommendation engine.
Key Features
- Algorithm retraining on U.S. data
- Cloud security within Oracle’s U.S. infrastructure
- Ownership split: Oracle, MGX, Silver Lake, and Michael Dell hold more than 80% of the company
Investor Details
The major investors in the joint venture include:
- Oracle – a leading cloud services provider
- MGX – a UAE investment firm
- Silver Lake – a prominent investment firm
- Michael Dell – technology entrepreneur and investor
These entities will collectively own the majority stake, ensuring that the U.S. operations of TikTok are controlled by non-Chinese interests.
Government Regulations and Extensions
A bipartisan law passed in 2024, signed by President Joe Biden, required TikTok to be sold to U.S. interests or face a ban. The first deadline for the sale or ban was Jan. 19, 2025. President Trump extended this deadline to April, then to June, then to September, and finally to January 22. Trump’s repeated extensions, despite lacking formal authority, highlight the political tug-of-war surrounding TikTok.
| Extension Date | New Deadline | Context |
|---|---|---|
| Jan. 19, 2025 | April | First deadline set by law |
| April | June | Trump’s executive order |
| June | September | Further extension |
| September | Jan. 22 | Latest extension |
The shifting deadlines underscore the uncertainty that has plagued the sale process. The new joint venture offers a tangible path forward, potentially satisfying the law’s requirement for a U.S. sale.
Company Response and Next Steps
TikTok clarified that the announcement is not a final deal to sell the company. A spokesperson for TikTok wrote, “I saw your question and want to call out that ‘deal to sell’ isn’t accurate framing. Please see language used in the press release.” The company’s statement was prompted by inquiries from News Of Austin after the New York Times first broke the news.
While the joint venture is a significant development, it remains a step toward a larger sale. The final agreement will still need to address ownership percentages, data security, and regulatory approvals. Stakeholders will closely monitor how the new structure aligns with the 2024 law and whether it satisfies the U.S. government’s national security concerns.
Key Takeaways
- TikTok has created a joint venture that could transfer majority ownership to U.S. investors.
- Over 80% of the new company will be owned by Oracle, MGX, Silver Lake, and Michael Dell.
- The venture will secure the recommendation algorithm in Oracle’s U.S. cloud.
- The deal moves the long-running sale debate toward a concrete outcome, potentially avoiding a ban.
- The U.S. government’s legal deadline extensions have created uncertainty, but the joint venture offers a path to compliance.
The outcome of this development will shape the future of TikTok in the United States, affecting users, advertisers, and policymakers alike.
