The memorandum signed by the parties separately emphasizes that TikTok’s algorithm will be retrained on U.S. users’ data to “ensure that content is not subject to external manipulation.”
As notes Euronews, the deal marks a major milestone for the popular short video app. It is regularly used by more than 170 million Americans.
US President Donald Trump launched a large-scale campaign against TikTok back in 2020, trying to ban the app because of its Chinese origin. After much debate and user outrage, it was decided to put the platform under the management of American companies in order to exclude the possibility of China to influence American society through the app.
The agreement to put TikTok under the management of a consortium of U.S. investors is set to close on Jan. 22, The Associated Press reported.
A group of investors – including Oracle, Silver Lake and Emirati investment firm MGX – will own half of the shares in the new TikTok US joint venture and will each receive a 15% stake. Another 19.9% of the new app will be owned by ByteDance itself, which is tasked with managing the app, plus 30.1% by affiliates of existing ByteDance investors, the memo said.
The U.S. entity will have a new seven-member board of directors, with a majority of American directors, the memorandum said. It will also be subject to terms and conditions that “protect Americans’ data and U.S. national security.”
U.S. users’ data will be stored locally on a system managed by Oracle. The memorandum says U.S. users will continue to “enjoy the same experience they have today,” and advertisers will continue to serve a global audience with no impact from the deal.
