The company announced Tuesday that its US service has now become part of the TikTok USDS Joint Venture LLC, with ByteDance holding only a 19.9% stake in this new entity. The rest is owned by Oracle, investment firms Silver Lake and MGX, and smaller investors like Michael Dell’s family investment firm. Oracle will be responsible for storing US data, and this joint venture will work on retraining, testing, and updating the content recommendation algorithm using data from US users. Additionally, the new entity will have the authority to make decisions regarding trust and safety policies and content moderation.
The press release provided limited details and left many questions unanswered since the initial announcement of the deal. For instance, it’s unclear how a licensing agreement for the algorithm could be structured to avoid any prohibited connection with ByteDance. Even lawmakers who supported the bill are still seeking clarity. House Select Committee on China Chair John Moolenaar (R-MI) raised concerns, asking, “Does this deal ensure China does not have influence over the algorithm? Can the parties involved assure Americans their data is secure?” He stressed these questions need answers as the Select Committee examines the deal.
Select Committee Ranking Member Ro Khanna (D-CA), who opposed the original bill and proposed one to repeal it, noted that the deal is fueling uncertainty among many creators. Khanna promised to engage with those whose livelihoods depend on the app, aiming to find a solution that maintains data security while protecting the thriving creator economy.
Sen. Ed Markey (D-MA), who voted for the foreign aid package that included the divest-or-ban bill, initially sought to secure a legal extension for the deal. After former President Trump disregarded the original deadlines, Markey later suggested canceling the ban legally. Now that a deal is in place, Markey stated, “this TikTok deal raises many more questions than answers.”
Trump has significantly influenced the negotiation process, discussing the TikTok deal with China’s President Xi Jinping and even joking with Oracle Chairman Larry Ellison about negotiating publicly. Markey expressed frustration that the White House has provided minimal details about this agreement, particularly concerning whether TikTok’s algorithm is genuinely free from Chinese influence, despite numerous requests for information. “This lack of transparency reeks,” Markey said. “Congress has a responsibility to investigate this deal, demand transparency, and ensure that any arrangement truly protects national security while keeping TikTok online.”
Many Democrats are also frustrated that close allies of Trump, like Ellison, could benefit from the arrangement. Energy and Commerce Committee Ranking Member Frank Pallone (D-NJ), who supported the initial bill, criticized the deal on X, stating, “This ‘deal’ helps Trump’s rich friends get richer in exchange for turning TikTok into a propaganda machine for the White House.” He emphasized that the limited information provided fails to address serious legal compliance issues or the national security threats posed by Beijing’s ongoing control of the platform.
