The White House has provided some key insight regarding TikTok’s likely restructuring. A new class of investors such as Oracle, Andreessen Horowitz and Silver Lake Management will lead this transformation. This change is the latest development in the drive to calm national security concerns über the popular social media platform.
Oracle will assume oversight for security and safety procedures on TikTok’s platform. This sale protects how user data would be handled, aligning it with U.S. laws and regulations. Additionally, under the new arrangement, Americans will occupy six of the seven board seats in TikTok’s restructured company, solidifying U.S. influence over the organization’s governance.
In a notable development, TikTok will no longer route its algorithm through China, instead housing algorithmic decision-making within the United States. This decision helps allay concerns around data privacy and foreign interference. This restructuring follows a series of extensions by President Donald Trump regarding a U.S. bill that would ban TikTok unless it is sold to new owners. There’s increasing concern that if we don’t get a deal in place in the near future, the application may be subject to severe limitations. It could even be permanently banned from the U.S. market.
With the deal now formally approved by Chinese President Xi Jinping, the stage has been set for a potentially historic change in control over the app. Under the deal, ByteDance will entertain holding a less than 20% stake in the new entity. This firm is a direct outcome of the TikTok spinoff.
Here’s what a senior White House official had to say about today’s announcement. He articulated that these amendments are necessary to restore American control and American security.
“So all of those details have already been agreed upon, now we just need this deal to be signed and that will be happening, I anticipate, in the coming days.” – Karoline Leavitt
These advancements come after months of lobbying and criticism over TikTok’s practices in the U.S. The pressure from U.S. lawmakers and the public sentiment in the U.S. about foreign apps has heavily shaped this restructuring process.
As the time for closing the deal draws near, the stakes for users and investors alike continue to grow. The involvement of prominent firms such as Oracle and Andreessen Horowitz could potentially reshape the landscape of social media in America while addressing security concerns raised over the past year.
