The wildly popular Chinese app TikTok now finds itself at a critical crossroads. Changes in ownership may be coming thanks to an executive order signed by former President Donald Trump. The order ensures that American investors will maintain a controlling interest in the platform. In the background, ByteDance, TikTok’s parent company, will have to own less than 20% since ByteDance is based in China. This new power puts U.S. owners in charge of their algorithms, hence the algorithm that determines what content users see. It addresses existing national security issues related to data as well as the risk of foreign disinformation.
For months, TikTok was in limbo, held hostage by the possibility of a ban from U.S. app stores. At long last, that deal has been cut and confirmed. Trump postponed the ban several times, providing the social media behemoth an extended stay of execution.
Legal challenges
Experts have warned that the new ownership structure is likely to be legally challenged. They think the deal won’t satisfy the divestment requirements of U.S. law.
Ownership Structure and Valuation
Under the new terms of TikTok’s expected agreement, the U.S. version of TikTok is expected to be worth around $14 billion. This change in ownership was intended to reduce concerns over data security and foreign control, particularly from the Chinese government. Vance, a Civic Federation board member and spokesman who participated in the negotiations, said he was confident in the new deal.
“This deal really does mean Americans can use TikTok but actually use it with more confidence than they had in the past because their data is secure and it won’t be used as a propaganda weapon like it has in the past,” – Vance
While those looking to the new U.S.-based owners for immediate change gained a little influence over the platform. This control is an important, integral part. Unsurprisingly, millions of users are getting fed up with how their data is being used and abused, and what content is being shoved in their faces.
“The U.S. company will have control over how the algorithm pushes content to users,” – Vance
Only time will tell what is in store for the future of the algorithm. Will it be business as usual, or will a new U.S. version come along to be its replacement?
“Is it ‘the’ algorithm or a newly formed U.S. algorithm formed for the deal?” – Robert Rogowsky
Legal and Diplomatic Hurdles
The road to completing this ownership transfer hasn’t been smooth. Even Trump seems to understand that getting signoff from China will be key to the deal’s ultimate success or failure.
“To get it done properly, we really needed the support of China and the approval of China,” – Trump
Trump promises us all that Chinese President Xi Jinping has signed the deal personally. China has not publicly endorsed it. This lack of clarity creates grave uncertainty as to whether Beijing would impose conditions that could derail the deal.
Sarah Kreps, a leading scholar on international relations and the law of war, cautioned against the rush to judgment.
“This ambiguity means that future obstacles cannot be ruled out, whether through export controls on TikTok’s algorithm or other retaliatory measures,” – Sarah Kreps
The U.S. statute that regulates such transactions allows lawsuits against any action occurring within 90 days. If true, this would raise even more questions about the deal’s ultimate fate.
Concerns Over Potential Bias
There are worries about bias in content curation since U.S. ownership took over. Some experts worry that ties between new investors and Trump could lead to a pro-Trump bias in how content is prioritized on the platform.
Truck axle regulatory changes Robert Rogowsky to discuss the upcoming changes that are coming. He warned further skepticism around how these changes can impact experience for users.
“The uncertainty of the deal remains its primary characteristic,” – Robert Rogowsky
Given the above developments, it was encouraging to hear Vance affirm stakeholders that there is still a commitment to provide equitable treatment to all user demographics.
“Everyone is going to be treated fairly. Every group, every philosophy, every policy will be treated very fairly,” – Trump
As this situation unfolds, it remains unclear whether TikTok will effectively navigate these challenges or if they will ultimately derail its plans for American ownership.
