ByteDance announced on Thursday the sale of the majority of its TikTok operations in the United States to a consortium led by Oracle, MGX, Silver Lake, and a group associated with Michael Dell. This consortium will control over 80% of the newly formed company, now named TikTok USDS.
This transaction concludes a six-year-long legal and political conflict that had threatened the app's future in the American market.
After more than a year of negotiations, the agreement stipulates that the new company will be headquartered in the U.S. with a board of directors primarily composed of American citizens.
Oracle will take charge of data management and cloud hosting, while the recommendation algorithm will be developed and maintained domestically. These measures are part of the safeguards required by Washington to ensure national security.
EFE reported that ByteDance will retain a minority stake of 19.9%, and its global chief executive, Shou Zi Chew, will remain in his role and join the board.
The new CEO of TikTok USDS will be Adam Presser, a former WarnerMedia executive, with Will Farrell serving as the head of security.
Former U.S. President Donald Trump praised the agreement, asserting that he "helped save TikTok," emphasizing that the app is now under the stewardship of "great American patriots and investors."
Trump also expressed gratitude to Chinese President Xi Jinping for approving the deal, which resolves the ban initiated during Trump's first term over security and propaganda concerns.
China's Foreign Ministry spokesperson, Guo Jiakun, refrained from directly commenting on the sale but reiterated Beijing's consistent and clear stance on TikTok, urging Washington to maintain a "fair and non-discriminatory" environment for Chinese businesses.
This sale signals the end of a prolonged tech dispute between the U.S. and China, ensuring the continued presence of the social network, which boasts over 200 million users in the U.S. and more than a billion globally.
Implications of TikTok's Sale in the U.S.
What does the TikTok sale mean for U.S. users?
The sale ensures TikTok's continued availability in the U.S., with enhanced data security measures and local oversight.
Who will manage TikTok's data in the U.S.?
Oracle will be responsible for managing and hosting TikTok's data within the United States, as part of the national security guarantees.
How does the agreement impact the relationship between the U.S. and China?
The agreement helps ease tensions between the U.S. and China by resolving a major point of contention, although broader geopolitical challenges remain.