The US and China have reportedly done a deal which will keep TikTok operating in America.
The video social media app’s business in America was under threat by a law to ban it, on national security concerns over the app’s Chinese parent company ByteDance, unless it was sold to US interests.
The White House gave some details of the plan for new ownership in the US which will keep America’s 170 million users on the social media app.
The deal shifts TikTok US into a joint venture with an 80% majority of American owners, with ByteDance at 20%, in keeping with a law passed last year.
Oracle would be security provider including looking after the algorithm that runs the platform.
One report said News Corp chair Lachlan Murdoch and his father, Rupert Murdoch, could be investing in the US operations of TikTok.
Emarketer principal analyst Jasmine Enberg said solving ownership of the algorithm is critical to the deal, as it is a crucial part of what makes TikTok tick, but it’s not the end of TikTok’s drawn out dance with the US.
“Social media is just as much about the culture as it is the technology, and how users will take to new ownership and potentially a new version of the app is still an open question,” Enberg said.
"Many users will migrate to a new app if they have to, if out of curiosity alone. But whether or not they stay depends on the user experience.
“Any material, or even perceived, changes to the content, algorithm or app policies could prompt shifts in behaviour. And if the new TikTok can’t retain its US audience, that would hurt its ability to monetize, making the app less valuable and influential."
"If an algorithm trained only on US-data cuts US users off from content from users in the rest of the world, and vice versa, that could degrade the experience and erode TikTok’s influence.
“While some brands may see a new TikTok app as a chance to secure a first-mover advantage, if global brands have to splinter their TikTok strategies, they might choose to spend their dollars elsewhere."
"It wouldn’t be the first time a shift in ownership has led to changes or declines in usage: When Elon Musk bought Twitter and remade it into X, many users fled as a result of the changes.
"It also provided an opportunity to social newcomers like BlueSky and incumbents like Meta, which launched Threads, to gain a foothold in the digital landscape. While still speculative, we could see similar dynamics play out again."
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