TikTok bows to Trump pressure, will now operate under US government oversight; China stake reduced

New Delhi (The Uttam Hindu): Social media platform TikTok announced on Friday that it has finalized the creation of a majority US-owned joint venture to manage its operations in the United States. This move has been taken to avoid long-standing restrictions and political pressure related to Chinese ownership.

The new entity will be called TikTok USDS Joint Venture LLC. It will serve more than 200 million users and around 7.5 million businesses in the United States. The company stated that the joint venture will function under strict standards related to data security, cyber security, content moderation, and the app’s recommendation algorithm.

Under the agreement, American and international investors will collectively hold 80.1 percent ownership, while TikTok’s Chinese parent company ByteDance will see its stake reduced to 19.9 percent.

Key investors include tech giant Oracle, private equity firm Silver Lake, and Abu Dhabi-based investment group MGX, each holding a 15 percent stake. Other stakeholders include the Dell Family Office, Alpha Wave Partners, Revolution, and NJJ Capital.

This agreement is the outcome of years of political and regulatory disputes surrounding TikTok in the United States, which began in 2020 when then-President Donald Trump attempted to ban the app, citing national security concerns.

Former President Donald Trump welcomed the deal and credited himself for the outcome. He said he was pleased to have helped save TikTok and added that the platform will now be owned by a group of strong American investors and patriots who will make it more powerful. Trump also thanked Chinese President Xi Jinping for cooperating with the United States and approving the agreement.