TikTok Finalises U.S. Joint Venture Deal to Prevent Nationwide Ban
TikTok’s Chinese parent company, ByteDance, announced on Thursday that it has completed a deal to create a majority American-owned joint venture aimed at securing U.S. user data and avoiding a national ban on the app. The new entity, called TikTok USDS Joint Venture LLC, will oversee the protection of American data through strengthened privacy and cybersecurity measures.
Majority American Ownership
The agreement marks a significant turning point after years of political and legal battles surrounding TikTok’s ownership and national security concerns. Under the deal, American and global investors will hold an 80.1% stake in the venture, while ByteDance will retain 19.9%.
Three managing investors—Oracle, Silver Lake, and Abu Dhabi-based MGX—will each hold 15%. Additional investors include Dell Family Office, Vastmere Strategic Investments, Alpha Wave Partners, Revolution, Merritt Way, Via Nova, Virgo LI, and NJJ Capital.
A White House official confirmed that both the U.S. and Chinese governments have signed off on the agreement. The deal complies with the 2024 U.S. divestiture law, which required ByteDance to sell its American assets or face a ban by January 2025.
Political Endorsement and Leadership Changes
Former U.S. President Donald Trump, who initially sought to ban the app in 2020, praised the deal in a social media post, saying TikTok “will now be owned by a group of Great American Patriots and Investors, the Biggest in the World.” He also thanked Chinese President Xi Jinping “for working with us and approving the Deal.”
Trump, who has over 16 million followers on TikTok, credited the app for boosting his reelection campaign. The White House also launched an official TikTok account last August to expand its digital outreach.
Leadership appointments within the new venture include Adam Presser as CEO and Will Farrell as Chief Security Officer, both formerly with TikTok USDS. TikTok CEO Shou Chew will sit on the venture’s board while continuing to lead the company’s global business operations.
Data Security and Operational Control
The joint venture will retrain, test, and update TikTok’s recommendation algorithm using only U.S. user data. Oracle’s U.S.-based cloud infrastructure will secure all algorithmic and data-related operations.
According to earlier reports, ByteDance will maintain ownership of TikTok’s U.S. business operations, including advertising and e-commerce, but control over user data, content moderation, and algorithmic decisions will rest with the new joint venture.
The deal represents a delicate balance between data security demands and commercial realities, potentially setting a precedent for how global technology companies navigate national security concerns in major markets.
with inputs from Reuters
