President Trump said Friday that he has reached a deal with China to keep the popular social video app TikTok running in the U.S.
Trump said on his social media platform that he had a “very productive call” Friday morning with China’s President Xi Jinping. TikTok is owned by Chinese tech company ByteDance, a fact that prompted U.S. national security concerns over data protection.
He suggested that Xi had approved the planned takeover of TikTok in the U.S., but did not provide details on what the leader’s sign-off entailed.
“We made progress on many very important issues including Trade, Fentanyl, the need to bring the War between Russia and Ukraine to an end, and the approval of the TikTok Deal,” Trump wrote Friday.
He added: “The call was a very good one, we will be speaking again by phone, appreciate the TikTok approval, and both look forward to meeting at APEC!”
Trump had signaled earlier this week that an agreement was coming. For months, TikTok’s future had been uncertain in the U.S., due to the national security worries. Trump in his social media post did not reveal much detail about the deal, but said this week that TikTok’s U.S. operations would be owned by American investors.
“TikTok has tremendous value,” Trump said at a news conference Thursday, adding that the U.S. will be getting a “fee-plus” for making the deal. “I’d rather reap the benefits. The kind of money we are talking about is very substantial. It will be owned by all American investors.”
The Wall Street Journal reported Tuesday that under terms of the deal, TikTok’s U.S. users would migrate to a new version of the app with technology licensed from ByteDance. U.S. user data would be managed in Texas by cloud computing company Oracle, the Journal reported, adding that details of the deal could change, as it was still being discussed.
About 80% of a new company running TikTok’s U.S. operations would be owned by American investors, with the remaining amount owned by Chinese shareholders, according to the Journal.
Oracle’s Chairman and Chief Technology Officer Larry Ellison is a Trump ally and the world’s second richest person with an estimated net worth of more than $360 billion, according to Forbes. Ellison is also preparing a bid for Warner Bros. Discovery, the media company that owns HBO, TNT and CNN, after already completing a takeover of Paramount, one of Hollywood’s original studios.
The White House did not immediately return a request for comment on the terms of the agreement.
Reports cited Xinhua, China’s state-run news agency, which quoted Xi as saying the Chinese government “respects the wishes of companies and welcomes them to conduct commercial negotiations based on market rules and reach solutions that comply with Chinese laws and regulations and balance interests.”
The deal paves a path for TikTok to continue operating in the U.S. after President Biden signed a law that would require ByteDance to divest ownership in the U.S. operations of the app or have TikTok banned in the nation due to security concerns. TikTok denies sharing user data with the Chinese government and says it has not been asked by Beijing to provide such sensitive information.
ByteDance on Friday thanked Xi and Trump “for their efforts to preserve TikTok in the United States.”
“ByteDance will work in accordance with applicable laws to ensure TikTok remains available to American users through TikTok U.S.,” the company said.
The law had initially given ByteDance a deadline of Jan. 19, but Trump has extended that deadline several times, most recently to Dec. 16.
TikTok has more than 170 million users in the U.S. and is a home for video content creators and businesses. Fans of the app enjoy scrolling through feeds of entertaining short videos.
Some industry observers were skeptical over whether the deal will adequately address Congress’ security concerns.
“There’s just too many loose ends and too many things that could go awry,” said Carl Tobias, a law professor at the University of Richmond School of Law.
The TikTok agreement comes as the U.S. and China have been dealing with trade talks amid a tariff war.
On Thursday, Trump credited TikTok with helping him win the 2024 presidential election. He had campaigned to try to keep TikTok operational in an appeal to younger voters. He reversed his stance from his first term, in which the Trump administration made moves toward banning the app.
Daniel Keum, an associate professor of management at Columbia Business School, said he doesn’t think much will change after a deal is made. Many creators have already posted their content in other places such as Instagram and YouTube in light of TikTok’s uncertain future, Keum said.
“Even before, as there was so much uncertainty around the fate of TikTok, a lot of other platforms like YouTube and Facebook were co-opting the short-reel format, so creators were distributing their content across other platforms,” he said.
