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Former President Donald Trump has signed an executive order that he says will allow TikTok to continue operating in the US while addressing national security requirements set out by law.
Last year, President Joe Biden signed legislation requiring TikTok’s Chinese parent company, ByteDance, to sell its US assets to an American firm or face a nationwide ban. However, Trump has repeatedly issued orders extending the app’s operations as his administration pursues a deal for its sale.
Details of the potential agreement remain unclear, though Trump said on Thursday that Chinese President Xi Jinping has approved the framework. Any significant change to TikTok’s ownership could have a major impact on how Americans, especially young users, consume information online.
About 43 per cent of US adults under the age of 30 say they regularly get news from TikTok, higher than any other social media app including YouTube, Facebook and Instagram, according to a Pew Research Centre report published on Thursday.
Under the terms of the deal that have so far been revealed by the White House, the app will be spun off into a new US joint venture owned by a consortium of American investors including Oracle and investment firm Silver Lake Partners.
Though the details have yet to be finalised, the investment group’s total stake in the new venture would be around 80 per cent, while ByteDance is expected to have a 20 per cent, or smaller, stake in the entity. The board running the new platform would be controlled by US investors. ByteDance will be represented by one person on the board, but that individual will be excluded from any security matters or related committees.
TikTok’s new owners include many whose business or political interests are tied to Trump, including Oracle co-founder Larry Ellison and Rupert Murdoch, raising questions about whether political influence will be exerted into the platform.
Although he stepped down as Oracle’s CEO more than a decade ago, Ellison remains heavily involved in its operations, as chairman and chief technology officer. Now 81, he could be in line to become a behind-the-scenes media power player, having already helped finance Skydance’s recently completed USD 8 billion merger with Paramount, a deal engineered by his son, David.
The recommendation algorithm that has steered millions of users into an endless stream of video shorts has been central in the security debate over TikTok. China previously maintained the algorithm must remain under Chinese control by law. But a US regulation that Congress passed with bipartisan support said any divestment of TikTok must mean the platform cut ties with ByteDance.
American officials previously warned the algorithm — which is a complex system of rules and calculations that platforms use to deliver content to your feed — is vulnerable to manipulation by Chinese authorities, who can use it to shape messaging on the platform in a way that’s difficult to detect, but no evidence has ever been presented by US officials showing that China has attempted to do so.
(With Inputs From Agencies)
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