TikTok has closed a deal that will allow the popular short-video app to continue operating in the United States by splitting its US app from its global business. The agreement, announced on Thursday, ends a prolonged standoff between Washington and Beijing over national security concerns tied to the app’s Chinese ownership.
The conflict dates back to the Trump administration’s initial attempts to ban TikTok in 2020, citing fears that user data could be accessed by the Chinese government. Under President Joe Biden, legislation was passed in 2024 requiring ByteDance, TikTok’s parent company, to divest its US operations or face a ban. A temporary shutdown occurred in January 2025, but was reversed after President Donald Trump intervened, highlighting the political volatility surrounding the issue.
The new deal establishes TikTok USDS Joint Venture LLC, an independent entity that will manage the app’s US operations. This joint venture is governed by a seven-member board with a majority of American directors, aiming to address data privacy and cybersecurity issues that have been central to the dispute. Adam Presser, formerly of WarnerMedia, has been appointed as the chief executive, ensuring American oversight of daily operations.
Ownership of the US business is divided among several investors. Oracle, Silver Lake, and MGX each hold a 15% stake, while ByteDance retains 19.9%. The remaining 35.1% is owned by a consortium including the family office of tech executive Michael Dell and Vastmere Strategic Investments, an affiliate of Susquehanna International Group, which has ties to Trump allies. This structure is designed to balance American control with ByteDance’s continued involvement.
A critical aspect of the deal is the handling of TikTok’s algorithm, often called its “secret sauce” for content recommendation. Previously controlled by ByteDance, the algorithm will now be licensed to the American owners and retrained exclusively on US user data, secured within Oracle’s cloud environment to comply with US regulations. This move aims to alleviate concerns about foreign influence on data and content curation.
This shift is expected to alter the user experience for TikTok’s approximately 200 million American users. Experts suggest the app may become slower or operate differently, with the algorithm potentially less effective at recommending content, though the exact changes remain uncertain. Users might notice a divergence from the global version, impacting cultural trends and engagement on the platform.
Politically, Trump has claimed credit for the resolution, stating on social media that he helped save TikTok. The deal reflects ongoing tensions in US-China relations and highlights the challenges of regulating global tech platforms amid geopolitical rivalries. It also underscores the complex interplay between national security, corporate interests, and user accessibility in the digital age.
Looking ahead, the success of this arrangement will depend on how well the new entity manages data security and maintains the app’s appeal. It sets a precedent for how other Chinese-owned apps might navigate similar pressures in the US market, signaling a complex future for international tech governance and cross-border data flows.
