Chinese video app will get one other lease on life – DW – 04/04/2025 | EUROtoday

TikTookay ought to already be shut down within the United States, in line with the legislation.

Last yr, the Biden administration demanded that the Chinese video app’s US operations both be bought or face a nationwide ban over nationwide safety points.

Lawmakers have been involved how the corporate offers with US-based consumer information and attainable Chinese authorities manipulation.

The concept of forcing ByteDance, its Chinese proprietor, to promote to an authorized non-Chinese proprietor acquired a lot of bipartisan Congressional assist and was signed into legislation by Joe Biden final April.

The federal legislation targets “foreign adversary controlled applications” and particularly mentions TikTookay and ByteDance. This definition signifies that not more than 20% of the corporate could be owned by people or corporations in a rustic listed as a “foreign adversary” — a title the US has bestowed on China.

The legislation gave the corporate till January 19, 2025, to promote its US-based enterprise and was upheld by the Supreme Court. The deadline was sooner or later earlier than Donald Trump’s second inauguration.

The TikTookay countdown deadline

As the January deadline approached, the app was briefly shut down, however returned after Trump signed an government order to provide it extra time on the market negotiations. It did not return to app shops till February.

The new sale deadline was April 5. But simply sooner or later earlier, on Friday, April 4, Trump pushed the deadline once more, permitting 75 extra days to discover a answer.

“My administration has been working very hard on a deal to save TikTok, and we have made tremendous progress,” the president mentioned on his social media platform Truth Social on Friday.

So far, the corporate continues to be in Chinese palms. Beijing officers are publicly in opposition to a sale and have made it clear that the corporate’s proprietary algorithm is know-how that can’t go away China. It is just not clear if they’ve reconsidered this stance.

In March, Trump advised reporters that the US was negotiating with consumers.

“We’re dealing with four different groups. And a lot of people want it, and it’s up to me,” he mentioned, with out saying who they have been or giving any particulars.

More not too long ago, the president met with officers on the White House to debate a sale and mentioned a plan can be introduced earlier than the newest deadline. This is a big reversal for Trump who was prepared to shut TikTookay again in 2020, however was blocked by federal courts.

Who really owns TikTookay now?

TikTookay is a subsidiary of privately held ByteDance. According to numbers printed by TikTookay, roughly 60% of ByteDance is owned by international institutional buyers. Another 20% is owned by the corporate’s founder and 20% by ByteDance workers.

Though these numbers can’t be verified for the reason that firm is just not obliged to launch official reviews, it appears a lot of the corporate is already owned outdoors of China.

Pennsylvania-based buying and selling and know-how agency Susquehanna International Group is the largest outdoors investor and now has 15% of the corporate. Arthur Dantchik, a Susquehanna co-founder is on the five-member ByteDance board.

Other present outdoors buyers are Sequoia Capital and General Atlantic, each headquartered within the US. William E. Ford, the CEO of General Atlantic, can also be on the ByteDance board.

Who is in line to purchase TikTookay?

Rumors have been flying of attainable suitors and last-minute provides to take over TikTookay’s US enterprise.

The title Steven Mnuchin, a former Trump treasury secretary, retains developing. As treasury secretary he was a cheerleader for a TikTookay sale in 2020. Some have prompt the US authorities might take over a part of the corporate.

Other potential buyers are Amazon, Microsoft, synthetic intelligence startup Perplexity AI, enterprise capital agency Andreesen Horowitz and a bunch headed by billionaire businessmen Frank McCourt.

Private fairness agency Blackstone Group has additionally been talked about. Its CEO, Stephen Schwarzman, is a well-connected Trump supporter and Republican megadonor.

Perhaps the most definitely candidate to steer a takeover is Oracle. The firm is already concerned with TikTookay and confirmed curiosity within the firm throughout Trump’s first time period.

Since 2020, Oracle has been maintaining US consumer information on home servers. Since the beginning of this yr, the corporate’s position grew to incorporate extra information safety measures to make sure compliance with US rules. Many assume the corporate will retain an operation position on the very least ought to the corporate proceed to function within the US.

What does Trump need from China?

It is tough to place a price ticket on TikTookay since there are such a lot of elements and unknowns proper now, particularly if the app’s algorithm is just not a part of the sale.

Still, any of the present buyers might improve their stakes or work with others to mix their affect by including in recent capital. A brand new possession construction with an even bigger proportion of US buyers would scale back the possession stake of Chinese buyers and keep away from a full-fledged sale.

In the tip although, it is going to be a query of worth, US authorities stress and Chinese acceptance of the deal.

The president has mentioned tariff negotiations could possibly be a part of the deal. Trump has already hit Chinese imports with tariff duties totaling 54%. If China let a sale go forward he might scale back tariffs or maintain again on implementing larger ones.

If a sale does not come collectively within the subsequent 75 days, the ban might go into impact and TikTookay might go darkish for tens of millions of US customers.

Edited by: Uwe Hessler

Editor’s notice: This article was initially printed on April 2, 2025 and up to date on April 4, 2025, with details about Donald Trump extending the deadline for the sale.