TikTok’s U.S. Fate: A Deal to Keep It Home

17 September 2025

A US-led group will control about 80% of TikTok. REUTERS

A major shift is underway to resolve the ongoing standoff between the U.S. government and ByteDance, TikTok’s China-based parent company. A consortium of American investors including Oracle, Silver Lake, and Andreessen Horowitz is poised to take roughly 80 percent control of TikTok’s U.S. operations under a new deal negotiated with China. Under this framework, ByteDance would retain just under 20% ownership. Experts familiar with the discussions say the proposed deal is designed to comply with U.S. national security laws while keeping the popular app functioning in America.

To meet congressional requirements, the new U.S. entity would feature a board dominated by U.S. members, including one appointee from the U.S. government. A key part of the agreement involves having all U.S. user data stored on Oracle’s servers in Texas, and users will eventually be asked to transition to a version of TikTok built specifically for the U.S.; this version will operate on a separate algorithmic and data system.

President Donald Trump has issued an executive order delaying enforcement of a law requiring ByteDance to divest its U.S. operations until December 16. This extension gives the parties time to finalize the deal while avoiding the shutdown of TikTok in the interim. Trump also announced that he will be discussing the framework with Chinese President Xi Jinping to seek a formal confirmation from China.

Still, some issues remain unresolved. Chief among them is the control over TikTok’s recommendation algorithm. Reports suggest that while ByteDance will license the algorithm to the new U.S. entity, U.S. lawmakers and national security experts there is concern that this licensing may not be enough to sever influence from China. Critics argue that as long as ByteDance has any say over algorithmic design or recommendation logic there remains risk.

Oracle is expected to play a central role not only in holding a stake but also in handling U.S. user data under what has been dubbed “Project Texas,” strengthening data localization and oversight. Other institutions joining the ownership mix include existing ByteDance investors such as KKR, General Atlantic, and Susquehanna.

For Oracle, the deal offers more than regulatory compliance it promises substantial returns. Analysts estimate this agreement could generate between US$480 million and US$800 million annually in cash flow for Oracle, which is positioning itself for major expansion in cloud computing and AI infrastructure. The company has committed billions in capital for data center development and has been working to strengthen its reputation as a cloud provider with national security credentials.

Though the deal appears close, it still must clear multiple hurdles. Congressional approval, regulatory sign-offs, and the explicit consent of Chinese authorities are all necessary for it to move forward. Meanwhile, many lawmakers remain skeptical, particularly about algorithm control and whether the deal truly removes potential Chinese influence.

What’s clear is that this proposal could be a template for how the U.S. handles other technology platforms with foreign ownership. The deal has been presented as satisfying both regulatory demands and preserving the business continuity of a platform used by over 170 million Americans. If implemented, it could help resolve a conflict that has dragged on for months. But the details who gets appointed, how licensing works, how oversight is enforced will determine whether it is seen as a true fix or simply a workaround.