(qlmbusinessnews.com . Sat 20th Sep, 2025) London, UK —
Oracle-Led Consortium May Secure TikTok's US Operations: A Shift in Digital Diplomacy
An imminent agreement regarding the future of TikTok appears to be on the horizon, with discussions planned between US President Donald Trump and his Chinese counterpart, Xi Jinping, scheduled for Friday.
Senior negotiators from both nations have reportedly reached a “framework” agreement earlier this week, which could potentially result in TikTok's US operations being acquired by a consortium of American companies.
Should the agreement be finalised, it is poised to mark a significant milestone in the ongoing trade discussions between the US and China, addressing a contentious issue that has dominated headlines for an extended period.
Specialists have shared insights with the Reporters on the potential outcomes of the final deal for TikTok's 170 million American users and the concessions Beijing may secure in exchange.
The American Version of TikTok Might Lack the ‘Secret Sauce'
Dubbed a “win-win” scenario by Chinese state media and lauded by Trump, who expressed his desire to proceed “for the kids”, the specifics of the deal remain somewhat ambiguous.
Anticipated reports suggest the emergence of a US-specific iteration of the app, potentially under the ownership of a consortium involving tech behemoth Oracle, alongside investment entities Andreessen Horowitz and Silver Lake, though confirmation from these companies is pending.
At the crux of the negotiations is TikTok's algorithm, the proprietary technology driving user-specific content recommendations, integral to the app's viral success. Competitors, including Instagram's Reels and YouTube's Shorts, have yet to replicate this success, highlighting the challenge in duplicating such innovative technology.
ByteDance, TikTok's Chinese parent company, alongside Beijing, has resisted relinquishing this prized asset. However, in an unforeseen development, China's top cybersecurity authority hinted at a potential compromise, allowing ByteDance to license its intellectual property to a US entity, without a complete transfer.
This softened stance from Beijing marks a significant shift, although it suggests that the US version may have to contend with a simplified form of the app's underlying technology, noted by computing expert Kokil Jaidka from the National University of Singapore.
While granting partial access may offer insights into the app's user engagement and monetisation strategies, it is unlikely ByteDance will fully disclose its valuable technology.
Obstacles and Political Contentions Remain
US Treasury Secretary Scott Bessent, leading the negotiation for the US, commented that the user experience would preserve its “Chinese characteristics”, a remark loaded with implications given its association with the Chinese Communist Party's distinctive governance style.
The issue of data access and TikTok's influence over American users has been a point of contention, spurring legislative action by former President Joe Biden last year, demanding TikTok relinquish control of its US operations or face prohibition.
Despite previous opposition, Trump has recently shown support for TikTok, crediting it for enhancing young voter turnout in his 2024 election victory. Nevertheless, any sale must navigate US legislative scrutiny and address bipartisan concerns in Congress, particularly around potential avenues for Chinese government influence under the proposed framework.
Legal expert Hdeel Abdelhady pointed out, “The stipulated full separation from ‘foreign adversary' control, a mere license, may not suffice,” highlighting the challenge of meeting legislative requirements.
Given the complexity surrounding transactions of this magnitude and existing uncertainties, including ByteDance's compromised ownership and operational distinctions between the US and global TikTok platforms, a conclusive agreement may still be some time away.
Strategic Implications and the Road Ahead
The proposed deal is seen as a significant victory for the Trump administration, showcasing the global influence of TikTok, an app with a vast user base extending from the US to the Philippines.
The licensing arrangement would enable ByteDance to maintain both its algorithm and a competitive edge, ensuring TikTok's continued presence in the lucrative US market while retaining the largest stake in the app.
This model could potentially pave the way for other Chinese technologies to enter the US market through licensing agreements, possibly including sectors critical to national competitiveness such as battery and rare earth technologies.
As negotiations proceed, the global stakes for both trade powerhouses remain high, with significant implications for their respective economies and technological landscapes.
The unfolding TikTok saga represents not just a business deal but a nuanced ballet of diplomacy, technological sovereignty, and bilateral trade relations, shadowed by political uncertainties and the quest for a sustainable, mutually beneficial compromise.
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