TikTok signs deal to give U.S. operations to Oracle-led investor group
TikTok has signed a deal to spin-off its U.S. operations to a group controlled by mostly American investors, including software giant Oracle, a company run by Trump ally Larry Ellison.
TikTok’s hyper-engaging algorithm and the massive amount of data that app has collected on millions of Americans is set to be overseen by the new U.S. entity. According to the agreement, TikTok’s U.S. algorithm will be retrained with only Americans data. Content moderation decisions will be made by the new U.S. entity.
Yet the algorithm will still be owned and updated by Beijing-based ByteDance, with the blessing of American auditors, according to two sources familiar with the deal who were not authorized to speak publicly.
“With an American majority running the content moderation, concerns about foreign propaganda seem to have been alleviated,” said Anupam Chander, a professor of law and technology at Georgetown University who studies the regulation of new technology. “But it is possible that the American TikTok might end up censoring or hiding speech that is permissible on the global TikTok platform. I would hope that the U.S. content moderation team would allow speech that the American owners might dislike.”
Under the terms of the sale, half of the new entity that will control the American version of TikTok will be owned by a consortium of investors including Oracle, private equity firm Silver Lake and United Arab Emirates state-backed investment firm MGX. Those three will control 45% of the new U.S. TikTok entity.
Oracle, Silver Lake and MGX did not return requests for comment.
About a third of the newly-formed TikTok operation will be held by existing investors of ByteDance, the Chinese parent company of the video app. And around 20% will be kept by ByteDance.
A seven-member board of directors, most being American, will oversee the new entity, according to the memo, which was first reported by Axios.
The deal caps more than five years of mounting pressure from Washington, where bipartisan concerns about TikTok’s ties to China prompted Congress to pass a law in 2024 that would have banned the app unless it was sold.
The law was upheld by the Supreme Court in January. For months, TikTok was technically operating in violation of federal law, but Trump issued a flurry of executive actions to delay enforcement of the law that would have banned the popular video app.
The White House declined to comment.
TikTok has an estimated 2 billion users globally, and less than 10% of its worldwide users are based in the U.S.
A new U.S. entity overseeing the American version creates a curious situation for the viral video app: One version of the service will be under the direction of an American-backed company, with additional checks and balances on content flows and data security while a second version of the app, wholly operated by ByteDance, will be available to the rest of the world.
The deal delivers a major win for Larry Ellison, expanding his family’s grip on more corners of American media and entertainment.
Ellison is a major backer of Paramount Skydance, a deal that was completed this year.
His son, David Ellison, who is the chairman and CEO of Paramount Skydance, has made a hostile bid to take over Warner Bros. Discovery, just as streaming giant Netflix has made its own bid, which top officials at Warner have endorsed.
Scientists push back on Trump plan to break up a critical climate and weather center
The White House plans to break up a key weather and climate research center in Colorado, a move experts say could jeopardize the accuracy of forecasting and prediction systems.
A Reddit post helped find MIT and Brown shooting suspect. Here’s what we know
Details are beginning to emerge about the life of Claudio Manuel Neves Valente, the gunman who killed two and injured nine others in the attack at Brown University last week. He is also believed to have killed an MIT professor on Monday, police said.
He’s the first African musician to get a Grammy Lifetime Achievement Award
The late, great Fela Kuti is known as the "Black President" for his role as both a musical and a political leader. Now he has become the first African artist to get this Grammy honor.
Millions of soon-to-be uninsured Americans are looking for a ‘plan B’
In January, millions of Americans will face more costly premiums on their ACA health plans. Some will go without insurance, pay out of pocket to see doctors, and use special prescription drug plans.
America’s new top health diplomat has strong opinions on abortion and gender
Bethany Kozma leads a key global health office at the Department of Health and Human Services. In past experience in the public eye, she's campaigned against abortion and gender-affirming care.
We caught up with one of the kids who sang on ‘A Charlie Brown Christmas.’ He’s 72 now
Dave Willat was just 11 years old when he showed up for what he thought would be a routine church choir practice in 1965. He and his fellow singers ended up making history.
