TikTok Officially Sold?

Why is nobody talking about the fact that China and the U.S. are incredibly close to a deal that would allow TikTok to operate here under American control? Earlier this year, ByteDance was told it would need to divest its majority ownership of TikTok or the app would be banned in the U.S. This became a hot topic, largely because of privacy concerns and ByteDance’s complete control over user data. Under the new deal being negotiated, Oracle would license TikTok’s existing algorithm while retaining majority ownership. Obviously, there’s still a lot we don’t know, and nothing has been finalized, but it looks like TikTok is here to stay (bring on the brainrot).

Given the articles I’ve been reading, it seems like the U.S. has accomplished what it set out to do with TikTok: siphon American user data away from China. One of the most interesting aspects of this deal is that the United States would be licensing the algorithm. From what I’ve seen, under the proposed terms, the owners of U.S.-based TikTok will lease a copy of the algorithm from ByteDance, which Oracle will then retrain for an American audience.

Please don’t screw up my perfect TikTok algorithm that I’ve built brick by brick over the years…

I’ve spoken about this before: TikTok Shop has seen substantial growth over the last 18 months, largely driven by heavy subsidies from ByteDance covering product discounts and shipping costs. That being said, TikTok has been increasing its fees over the past year, moving from 2% to 8%. So what happens now? Do the current investors have to start losing hundreds of millions of dollars to keep TikTok Shop afloat? Something worth watching after the deal is finalized is whether sellers on TikTok continue to see the profit margins they’ve enjoyed, and whether this new U.S. algorithm will maintain the same heavy emphasis on TikTok Shop that I’ve seen for the last six months.

Is this new entity going to impose new guidelines around content policy? There are a ton of political commentary creators on the platform, and it’s possible the retrained algorithm could affect them. I also think it could heavily impact DMCA takedowns. Right now, TikTok does not actively police copyright infringement and instead relies on copyright holders to submit DMCA takedown notices. Does that change after the deal goes through?

Another thing I’ve been thinking about is whether, once this deal with ByteDance is finalized, the U.S. government will start looking at other companies under majority Chinese control that hold large amounts of American user data. For example, Riot Games (I’m a massive League of Legends player), not to mention all the other mobile games Tencent owns. You could also make the argument for Temu and Shein. It’ll be interesting to see if anything comes from this in the future.

TikTok will likely remain in the U.S. with American investors, an American-led board, Oracle managing data, and a retrained algorithm free from ByteDance control. That setup avoids a ban but could change how content and TikTok Shop function for creators. It also signals how the U.S. may approach other Chinese-owned apps in the future.

Mafiathon 3 is in the final stretch, huge congrats to the team so far 🎉

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