SAN FRANCISCO (AP) — TikTok has struck a deal to sell its U.S. operations to a group of American investors, which includes Oracle, Silver Lake, and MGX. This move ensures the platform can continue its services in the United States.
According to an internal memo, the deal is set to finalize on January 22. CEO Shou Zi Chew announced that TikTok’s parent company, ByteDance, has signed binding agreements with these investors.
Under the new plan, the consortium will own half of TikTok’s U.S. business. Each of the three investors will hold a 15% share. Another chunk will go to affiliates of existing ByteDance investors, and 19.9% will remain with ByteDance, as stated in the memo.
A new board of directors with a majority of American members will oversee the U.S. operations. The plan includes strict guidelines to protect user data and ensure national security. Notably, user information will be stored locally, managed by Oracle.
One major change involves TikTok’s algorithm, which will be retrained using U.S. user data. This aims to prevent any outside manipulation of content. Additionally, the venture will have full control over content moderation and policies in the country.
This agreement marks a pivotal moment for TikTok. For years, there has been uncertainty about its future in the U.S., especially following concerns from lawmakers about data privacy and security. A law was passed requiring TikTok to find a new owner or face restrictions by January 2025. Interestingly, former President Donald Trump had previously signed executive orders to keep the app running while seeking a resolution.
Recent trends show that concerns about data privacy still resonate with users. A survey from the Pew Research Center found that 79% of Americans worry about how their data is used online. This highlights the importance of TikTok’s commitments to user data protection.
In the evolving landscape of social media and data privacy, expert opinions suggest that this deal may set a precedent for how foreign-owned companies operate in the U.S. tech space. Legal experts argue this could influence future regulations for tech firms, especially regarding data security practices.
This agreement not only affects TikTok’s future but also reflects broader trends in tech regulation. As social media platforms continue to grow, balancing user safety and accessibility becomes increasingly crucial.
