TikTok reaches deal for new US joint venture to avoid American ban
The deal is a milestone for the short video app after years of battles that began in August 2020, when President Donald Trump first tried unsuccessfully to ban the app over national security concerns.
The US–TikTok deal shows that it is possible to reconfigure a global platform so that it operates on national terms. (Photo: AP)
TikTok’s Chinese owner ByteDance said on Thursday it has finalised a deal to create a majority American-owned joint venture to secure US user data, clearing the way for the video app to continue operating in the United States.
The move avoids a potential ban under a US law that required TikTok to divest its American operations over national security concerns. The app has more than 200 million users in the United States.
Under the deal, the new entity, TikTok USDS Joint Venture LLC, will be owned 80.1% by American and global investors, while ByteDance will retain 19.9% ownership.
Cloud firm Oracle, private equity group Silver Lake, and Abu Dhabi-based investment company MGX will each hold 15% stakes and act as managing investors. The venture will store US user data and secure TikTok’s algorithm on Oracle’s US-based cloud infrastructure, TikTok said.
A White House official told Reuters that both the US and Chinese governments had approved the agreement. The Chinese embassy in Washington did not immediately comment.
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The deal follows years of scrutiny that began in 2020, when concerns were raised about the app’s Chinese ownership. US President Donald Trump delayed enforcement of the ban last year while negotiations continued.
Trump praised the agreement in a post on his Truth Social platform, saying it had ensured TikTok would remain available in the United States.
“I am so happy to have helped in saving TikTok,” Trump wrote. “It will now be owned by a group of great American investors.”
Trump also said the app had played a role in his 2024 election campaign. “Along with other factors, it was responsible for my doing so well with the youth vote,” he wrote.
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He thanked Vice President JD Vance and other members of his administration for finalising the agreement, and said he appreciated Chinese President Xi Jinping for approving the deal.
“He could have gone the other way, but didn’t,” Trump said. Trump has more than 16 million followers on TikTok, and the White House launched an official TikTok account last year.
TikTok said the joint venture will handle US user data, cybersecurity and the recommendation algorithm. The algorithm will be retrained and tested using US data within the new structure.
Former TikTok USDS executives Adam Presser and Will Farrell have been appointed chief executive and chief security officer of the venture. TikTok CEO Shou Chew will sit on its board.
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ByteDance will continue to control TikTok’s global operations, while the US venture will receive revenue for providing technology and data services, according to earlier Reuters reporting.
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The US–TikTok deal shows that it is possible to reconfigure a global platform so that it operates on national terms. (Photo: AP) 
