President Donald Trump is expected to firm an executive order this Thursday to end an agreement between the American and Chinese leaders of Tiktok, according to several reports, probably placing the application of social networks in the hands of possibly a trio or more of the richest in the world, and all Trump supporters.
Key data
As part of a prohibition approved by Congress in April 2024, Bytedance, the company that owns Tiktok based in China, must unintentionally disin on the social network or face a prohibition in the United States. However, Trump extended the deadline for Bytedance to do it repeatedly and recently stated: “We have an agreement on Tiktok.”
Tiktok could be valued between 40,000 and 50,000 million dollars, wrote Wedbush Securities, Dan Iives, earlier this year, although that estimate excluded the Bytedonce recommendation algorithm (Bytedance was valued, it was valued at more than 330,000 million dollars in August).
Tiktok is the third most popular social network in the United States by audience in computers and mobile devices, with approximately 124.7 million users in August, below 137.3 million Facebook and 162.5 million YouTube, according to estimates of the Digital Intelligence Services of SimilarWeb.
When will the agreement with Tiktok be completed?
Trump is expected to firm an executive order this Thursday, which would declare that the agreement for Bytedance to fall apart from Tiktok’s American operations meets the requirements of the 2024 law that prohibits the application, Reuters reported, citing a white house source with knowledge of the matter.
The White House Secretary, Karoline Leavitt, suggested during the weekend that an agreement “in the next few days will probably be signed.
What do we know about the terms of the agreement?
The secretary of the Treasury, Scott Besent, declared last week that the US and China commercial negotiators agreed a “frame” for the agreement that Tiktok would transfer to American property, although the details were not specified, except for the possible investors.
MOST CONTEXT: They report that Trump will sign Executive Order on Tiktok on Thursday
Who could control Tiktok?
According to Leavitt, six of the seven positions on the Tiktok Board of Directors in the United States will be part of the agreement. Oracle, the cloud computing firm led by billionaire Larry Ellison, would be in charge of data management and privacy of Tiktok and store the data in its facilities in the United States, preventing access from China.
Ellison’s firm is among investors that will have a participation of approximately 80% in the company, in addition to Andreessen Horowitz, the Risk Capital Company of multimillionaire Marc Andreessen, and the private capital firm Silver Lake.
It is expected that current American investors from Bytedonce, such as Susquehanna International, KKR and General Atlantic, are also part of the controlling group, while Chinese shareholders will possess the remaining 20%.
Trump suggested that Lachlan Murdoch, heir to the billionaire magnate of the media Rupert Murdoch, could also be linked to the agreement, adding: “Rupert will probably be in the group, I think they will be in the group.”
What will happen to the addictive recommendation algorithm?
Bytedance will copy the Tiktok recommendation algorithm and will be rented to the US entity as part of the agreement, said the Wall Street Journal, citing a White House official. The company, under the supervision of Oracle and the US government, would replicate the algorithm for users residing in the United States.
What did China say about the agreement?
Trump thanked the Chinese president, Xi Jinping, for “the approval of Tiktok” last week, indicating that they had achieved “advances in many very important issues” in a recent phone call.
The Chinese Ministry of Foreign Affairs, in a statement after Trump’s call with XI, did not specify whether XI had approved the agreement. The Ministry pointed out that the Chinese government “respects corporate decisions and welcomes the commercial negotiations that follow the market rules and generate consistent solutions with Chinese laws and a balance of interests.”
In the call, XI asked Trump to avoid imposing “unilateral commercial restrictions” to China, according to the statement. Leavitt said that the Trump administration is entrusted with “100%” in which China will give the final approval.
Why was Tiktok prohibited in the US?
President Joe Biden promulgated the prohibition of Tiktok in the US last year, after years of bipartisan scrutiny about the application amid concerns about data privacy and alleged links with the Chinese government.
Forbes previously reported that Tiktok spied on journalists, promoted Chinese propaganda in the application, unduly manipulated user information, such as social security numbers, and tracked “sensitive words.”
Tiktok denied any irregularity and having links with the Chinese government, claiming in a lawsuit that the prohibition violates its rights covered by the first amendment. Tiktok said a prohibition was “simply impossible: neither commercial, nor technological, nor legally.”
The Supreme Court confirmed the prohibition in January, ruling that the law does not violate the rights of the application covered by the first amendment and supporting the national security concerns of the federal government.
This article was originally published in Forbes US
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