TikTok has taken one of its most important moves yet to protect its future in the US after years of political tension, legal drama, and regulatory uncertainty. ByteDance, the Chinese business that owns the very popular short video app, has signed legally binding agreements to give ownership of TikTok’s US operations to a new joint venture run by American and worldwide investors. Many people think that the change is an attempt to deal with US national security issues that have been around for a long time and to avert a possible statewide ban that has been hanging over the app since 2020.
TikTok is very popular in the US, with more than 170 million people using it frequently for news, entertainment, education, and creative expression. It has become a big part of popular culture over time, setting trends, affecting music charts, and even being a part of political talk. That cultural footprint is what has made the app so controversial in Washington, where lawmakers have frequently highlighted concerns about data security and the power of a Chinese-owned tech business that works on such a large scale.
The new deal gives ByteDance a 19.9% share in the newly formed TikTok USDS Joint Venture LLC. A group of investors will own 80.1% of the company. These are Oracle, the private equity firm Silver Lake, and the investment organisation MGX, which is based in Abu Dhabi. The structure is meant to offer US and allied investors unambiguous majority control, which is a necessity under US law to keep foreign investors from having too much power over critical digital platforms.
Analysts and industry watchers are curious about the deal’s financial specifics, which have not been made public. But US officials had said before that the new business would be worth about $14 billion, which was less than what many analysts had expected at the time. Even though there were no fresh valuation numbers, the market reacted well, with Oracle shares surging substantially in premarket trade after the news of the deal.
This change didn’t happen all at once. The TikTok debate goes back to August 2020, when then-President Donald Trump tried to ban the app for the first time. He said that data access and possible Chinese government control were national security risks. That first attempt failed in court, but it started years of talks, legislative ideas, and political manoeuvring that placed TikTok’s US business in a state of uncertainty.
A law passed in 2024 said that ByteDance had to sell TikTok‘s US assets or be banned. The law didn’t go into effect until January 20, which gave everyone more time to work out a settlement. In September, Trump said in public that the proposed deal met the legal standards for divestiture. This got over a big political hurdle and made room for the contractual agreements that were disclosed this week.
TikTok’s bosses have called the joint venture a turning point in an internal memo that was shared with staff. Shou Zi Chew, the CEO of TikTok, told employees that the new company would “operate as an independent entity with authority over U.S. data protection, algorithm security, content moderation, and software assurance.” The app’s main point is that those guarantees show that the purchase really isolates TikTok’s US operations from ByteDance’s China-based business.
There are still questions, though. The White House has said that the joint venture will run TikTok’s US app, but it has mostly left it up to the corporation to explain things in more detail. People are still closely watching the exact nature of the ongoing partnership between ByteDance and the new company, especially when it comes to technology, intellectual property, and algorithm development. Even a little ownership position can be a problem if operational limits aren’t firmly enforced.
Oracle’s cooperation is extremely important from a practical point of view. Oracle has long seen itself as a trustworthy keeper of sensitive data because it is one of the biggest cloud computing companies in the US. Its new job is meant to persuade authorities that American customer data will be kept and managed in the US, using technologies that are overseen by the US. For a lot of people who make decisions, this has been one of the most important areas of disagreement in the TikTok debate.
There is also a bigger picture in the sector to think about. TikTok’s position is part of a rising trend around the world in which governments are taking increasing control of digital platforms, especially those that are owned by people in more than one country. More and more, tech companies are getting stuck between national laws and the fact that the internet is global by nature. In the future, the TikTok joint venture might be used as an example of how big internet companies deal with these kinds of problems.
The announcement gives cautious relief to both creators and regular users. People are scared that TikTok could abruptly disappear from app stores or stop working in the US because of years of uncertainty. A lot of small businesses, artists, teachers, and influencers now use the platform to make money and get their name out there. The accord doesn’t get rid of all risk, but it does make the possibility of a ban much less likely in the short term and gives a clearer way forward.
At the same time, doubt is still there. People who disagree say that changes to the structure on paper must be matched with real operational independence in practice. Regulators will probably keep a careful eye on how the joint venture works, how data transfers are handled, and whether ByteDance’s power is really confined to its small ownership.
