Fri, 23 Jan 2026

Fri, 23 Jan 2026 The rollercoaster years that led to the US-TikTok deal

It is a challenge for TikTok's parent company ByteDance as well as global ambitions for other Chinese tech companies.

* One in seven people worldwide use TikTok.
* Despite concerns over data security, ByteDance has managed to maintain a significant presence in the US market.
* In 2024, Congress passed a law threatening to ban TikTok unless ByteDance transferred majority ownership and changed how the app operates in the US.
* A deal has been reached, with ByteDance agreeing to split the US app from its global business under a new consortium of companies that includes Oracle.
* The terms of the deal allow China to frame the outcome as a win, while gaining leverage in broader trade negotiations.
* TikTok will remain available in the US, but with significant changes: + ByteDance will lose control over the algorithm and data used by the app. + The company will license the algorithm to the new US entity for $14 billion. + Advertisers and creators may see engagement shrink due to a US-only algorithm.
* ByteDance retains a 19.9% stake in the new consortium, ensuring a share of profits.
* The retraining of the algorithm may have consequences for ByteDance's technology development, including increased engineering costs and operational complexity.
* The deal sets a template for how other Chinese tech companies may expand globally in an environment of increasing mistrust of Beijing.
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