TikTok has completed a deal that secures the app’s future in the United States. The company announced the agreement on Thursday, ending years of legal and political uncertainty.
The agreement resolves a prolonged dispute between Washington and Beijing. The conflict began during Donald Trump’s first presidency when he attempted to ban TikTok over national security concerns.
US law threatened to block TikTok in January 2025 unless ByteDance sold its American operations. Trump delayed enforcement multiple times after returning to office.
The dispute focused on TikTok’s recommendation algorithm. Under the deal, American owners now license the system, which will train exclusively on data from US users.
Analysts predict noticeable changes to the platform. The full impact on roughly 200 million American users remains uncertain.
Political pressure forces separation
US officials pressured TikTok for years to separate from ByteDance. Lawmakers cited concerns that Chinese ownership could put user data at risk.
They warned Beijing could compel the company to hand over US user information. TikTok and ByteDance repeatedly rejected these claims.
Trump first suggested banning TikTok in 2020. Support for the move grew under President Joe Biden. In 2024, Biden signed legislation demanding a sale or a nationwide ban.
ByteDance challenged the law in court. In January last year, TikTok temporarily went offline in the US for 12 to 14 hours.
Service resumed after Trump, then president-elect, promised to reverse the ban. Later, Trump said he had reached an understanding with China to keep TikTok active.
In December, TikTok signed binding agreements with American and international investors. CEO Shou Zi Chew confirmed the deal in an internal memo.
New US-based structure
The agreement establishes TikTok USDS Joint Venture LLC. The entity will secure apps, algorithms, and user data through strict cybersecurity measures.
The joint venture will operate independently under a seven-member board with an American majority. Adam Presser, formerly of WarnerMedia, now serves as chief executive.
Three managing investors each hold 15% of the US business. Oracle will secure American user data and oversee retraining of the recommendation algorithm.
Oracle is chaired by Larry Ellison, a major Republican donor and Trump ally. Silver Lake, a US technology investment firm managing about $116bn in assets, also participates. MGX, an Emirati investor in AI and technology, completes the group.
Ownership and leadership
ByteDance retains a 19.9% stake in the venture. Investors hold the remaining 35.1%, including Michael Dell’s family office and Vastmere Strategic Investments, an affiliate of Susquehanna International Group.
Jeff Yass, co-founder of Susquehanna and a Trump ally, held roughly 7% of ByteDance last year. Susquehanna managing director Mark Dooley will join the board.
Shou Zi Chew will also serve on the board alongside executives from Oracle, Silver Lake, and MGX.
Algorithm remains central to US operations
TikTok’s algorithm lies at the heart of the deal. Experts describe it as the platform’s most valuable asset.
A former social media executive said competitors could not replicate its success. Instagram Reels and YouTube Shorts never matched its performance. Early innovators, he noted, usually understand their technology best.
ByteDance initially refused to release the algorithm. Chinese authorities backed that stance. In September, China’s cybersecurity regulator signalled it might allow ByteDance to license the system to American owners.
Under the agreement, the algorithm will rely solely on US user data, which will comply with American regulations. TikTok said Oracle will secure the system in its US cloud infrastructure.
Experts warn US users may notice a lighter, potentially slower app. Recommendations could also become less precise than in the global version.
