Trump Claims a TikTok Deal is Done: Who Would Own It, and How Would It Work?

Trump Claims a TikTok Deal is Done: Who Would Own It, and How Would It Work?

Estimated Reading Time: 5 minutes

• Donald Trump asserts a “done deal” for TikTok’s US operations, but this remains unconfirmed by China or ByteDance.
• A potential deal would likely involve a new US-controlled entity or a sophisticated partnership model, focusing on data security and independent governance rather than a full acquisition of ByteDance’s core technology.
• Executing such an agreement faces immense technical (infrastructure separation, algorithm independence), legal (CFIUS, Chinese export controls), and geopolitical hurdles.
• Previous high-profile attempts, such as the Oracle/Walmart partnership, highlight the formidable obstacles and complexities involved in these transactions.
• Users and businesses leveraging TikTok are advised to diversify their social media presence and review data privacy settings amidst the ongoing uncertainty.

• Key Takeaways
• The Shifting Sands of TikTok’s US Future
• Deconstructing Trump’s “Deal”: Ownership and Structure
• The Intricacies of Execution: Technical, Legal, and Political Hurdles
• Actionable Steps
• Conclusion
• Frequently Asked Questions (FAQ)
• Share Your Insights

The saga of TikTok in the United States has been a whirlwind of national security concerns, executive orders, proposed bans, and now, claims of a resolution. Former President Donald Trump recently asserted that a deal concerning TikTok’s future in the US is “done,” reigniting a complex debate that has significant implications for technology, geopolitics, and free speech.

This pronouncement, however, immediately begs a myriad of questions. What kind of deal would this entail? Who would emerge as the new owner or controlling entity? And most importantly, how would such an agreement actually function in practice, considering the intricate web of technical infrastructure, legal frameworks, and political sensitivities involved? The immediate challenge to this claim is that Trump says a deal is done but the details have not been confirmed by China or the app’s owner ByteDance.

This article will delve into the labyrinthine world of a potential TikTok transaction, examining the historical context, dissecting the possible ownership models, and outlining the formidable challenges inherent in executing such a high-stakes agreement.

The Shifting Sands of TikTok’s US Future

TikTok’s meteoric rise to prominence in the US has been paralleled by an escalating level of scrutiny from Washington. Concerns largely center on national security risks, specifically the potential for the Chinese government to access American user data or influence the app’s powerful recommendation algorithm to spread propaganda or censor content.

These worries culminated in August 2020 when then-President Trump issued executive orders threatening to ban TikTok’s operations in the US unless its Chinese parent company, ByteDance, divested its US assets. This pressure initiated a scramble for potential American buyers, with tech giants like Microsoft, Oracle, and retail behemoth Walmart all entering the fray at various points.

The most concrete proposal at the time involved Oracle and Walmart partnering to acquire a significant stake in a newly formed US-based entity, “TikTok Global.” This arrangement was envisioned to address data security concerns by housing US user data on Oracle’s cloud servers and establishing an independent board. However, this deal, like others, ultimately stalled amidst a complex interplay of US regulatory demands, Chinese export control regulations on AI technology, and a change in US presidential administration.

The persistence of these underlying concerns means that any new “deal” would inherently need to address the same fundamental issues that plagued previous attempts. The question remains: has the political and technological landscape shifted enough to make a breakthrough possible now?

Deconstructing Trump’s “Deal”: Ownership and Structure

Assuming a deal is indeed in the works, the critical questions revolve around its structure and ownership. Given the history, a full, outright acquisition of TikTok’s US operations by an American company seems highly improbable, especially with China’s firm stance against forced divestiture of ByteDance’s core technology, particularly its algorithms.

More likely scenarios would involve a partial ownership structure or a sophisticated partnership model, similar to the previously proposed “TikTok Global” concept. Here’s how such an arrangement might be envisioned:

1. New US Entity with American Majority Ownership: This model would involve creating a new, independent US-based company responsible for TikTok’s US operations. American investors or a consortium of US companies (e.g., tech firms, private equity) would hold a majority stake, ensuring US control over governance and operations. ByteDance might retain a minority, non-controlling stake.
2. Strategic Partnership with Data Security Focus: Rather than a full sale, the deal could center on a strategic partnership. A US technology company (like Oracle in the previous proposal) would become the “trusted technology provider,” responsible for hosting all US user data on American soil, managing its security, and possibly overseeing aspects of content moderation within the US. This model emphasizes data integrity and operational transparency without requiring full ownership transfer.
3. Independent Governance and Oversight: A crucial element of any “done deal” would be the establishment of an independent US board of directors, potentially with government-approved members, to oversee critical aspects of TikTok’s US operations. This board would monitor data privacy protocols, content moderation policies, and algorithm integrity to ensure compliance with US national security directives.

The “who” in terms of ownership is less about a single entity and more about a consortium or a combination of strategic partners. The goal is to establish verifiable US control over the data, the algorithm’s influence on US users, and content moderation, thereby mitigating the perceived national security risks without forcing ByteDance to completely abandon its highly valuable asset.

The Intricacies of Execution: Technical, Legal, and Political Hurdles

Even with a conceptual agreement, translating a “deal” into a functional reality is fraught with immense technical, legal, and political challenges. The complexity goes far beyond a simple change of hands.

Technical Hurdles: Separating TikTok’s US operations from ByteDance’s global infrastructure is a monumental task. This involves migrating vast amounts of user data, segmenting or “forking” the underlying codebase, and ensuring the continued functionality and updates of the app. The core recommendation algorithm, TikTok’s secret sauce, is deeply integrated into ByteDance’s global R&D. Establishing a truly independent, US-controlled algorithm that maintains the app’s addictive user experience while being free from foreign influence is an engineering marvel in itself.

Legal and Regulatory Hurdles: Any deal would face intense scrutiny from various US government bodies, including the Committee on Foreign Investment in the United States (CFIUS), which reviews transactions for national security implications. Antitrust concerns could also arise if major US tech players are involved. Crucially, the Chinese government would also need to approve such a transaction, especially given its export controls on AI technologies. Beijing’s previous statements indicate a strong unwillingness to allow ByteDance to be forced into selling its core intellectual property.

Political and Geopolitical Hurdles: Beyond the immediate transaction, the deal’s success hinges on the broader political climate between the US and China. A perceived win for either side could be seen as a loss for the other, complicating negotiations and approvals. Furthermore, securing bipartisan support in the US for any agreement would be essential for its long-term viability, preventing future administrations from unraveling it. The involvement of Donald Trump, given his history with TikTok, adds another layer of political complexity.

A real-world example highlighting these difficulties is the failed Oracle/Walmart deal itself. While framed as a solution to US concerns by creating “TikTok Global” with US data hosting and oversight, the proposal ultimately couldn’t overcome the combined resistance from China’s new export restrictions on AI, ByteDance’s reluctance to relinquish core control, and the changing political priorities of the incoming Biden administration. This illustrates that even a well-intentioned proposal can collapse under the weight of geopolitical and regulatory crosscurrents.

Actionable Steps

Given the ongoing uncertainty and the complex implications of any potential TikTok deal, here are three actionable steps:

1. For Businesses and Developers Leveraging TikTok: Diversify your social media presence. While TikTok remains dominant, actively explore and invest in other platforms to mitigate risks associated with potential disruptions, policy changes, or even a ban. Staying agile and not relying solely on one channel is crucial.
2. For Current TikTok Users: Be mindful of your data privacy settings and review them regularly. Understand that even with a US-led deal, the landscape of digital privacy is constantly evolving. Consider backing up valuable content you’ve created on the platform, as future changes could impact content access or transferability.
3. For Policy Analysts and Investors: Closely monitor official statements from the US and Chinese governments, as well as ByteDance, for verified details. Unconfirmed claims often serve as political signals rather than concrete agreements. Understanding the nuances of regulatory language, particularly concerning data governance and AI export controls, will be key to predicting the true feasibility and impact of any proposed deal.

Conclusion

Donald Trump’s claim of a “done deal” for TikTok’s US operations injects a new wave of anticipation and speculation into an already tumultuous situation. However, without official confirmation from ByteDance or the Chinese government, and with the fresh memory of previous failed attempts, skepticism remains warranted.

Any viable resolution to the TikTok saga would require navigating an intricate maze of technical disentanglement, robust legal frameworks, and delicate geopolitical negotiations. The ultimate outcome will not only determine the fate of one of the world’s most popular apps in its largest market but also set a precedent for how governments address national security concerns in an increasingly interconnected digital world. Until concrete details emerge and are officially confirmed, the future of TikTok in the US remains very much an open question.

Frequently Asked Questions (FAQ)

What are your thoughts on a potential TikTok deal and its implications? Share your insights in the comments below!