Executive Summary
The Story So Far
Why This Matters
Who Thinks What?
TikTok’s algorithm and its U.S. operations are set to be overseen by Oracle and controlled by a new, American-majority ownership group as part of a deal aimed at addressing national security concerns. The agreement, confirmed by the White House, will transfer control of the popular app’s U.S. functions and a copy of its content recommendation engine to a U.S.-based joint venture, with formal completion anticipated early next year.
Ownership Structure
The new ownership group will feature a majority of American investors and be led by a majority American board of directors. Investors are expected to include Oracle and private equity firm Silver Lake, alongside existing U.S. and global firms invested in TikTok’s parent company, ByteDance, and a number of new investors. ByteDance will retain a stake of less than 20% in TikTok US.
President Donald Trump indicated that tech and media leaders Michael Dell, along with Lachlan and Rupert Murdoch, might also join the new ownership group. However, a source clarified that Fox Corp. would be an investor, rather than the Murdochs individually. The full investor group is still undergoing finalization.
Regulatory Path and Timeline
The deal is currently awaiting formal regulatory approvals from China, though U.S. leaders have expressed confidence in its eventual completion. Trump is expected to sign an executive order affirming the deal as a qualified divestiture, as mandated by the ban-or-sale law, and will extend the enforcement pause for another 120 days. ByteDance is also anticipated to sign an agreement with one or more of the new investors, with formal completion likely early next year.
Algorithm Control and Security
The fate of TikTok’s algorithm had been a central question, given its critical role in the app’s popularity and the national security concerns surrounding it. U.S. officials had voiced worries that ByteDance could be compelled to manipulate the algorithm on behalf of the Chinese government. The ban-or-sale law specifically prohibits “any cooperation with respect to the operation of a content recommendation algorithm” between ByteDance and the new ownership group.
Under the agreement, the new ownership group will receive a copy of the algorithm code, review it, and retrain it using U.S. user data. Oracle will then assume continuous monitoring of how content is presented to users. This control, however, will apply only to U.S. users, raising questions about whether American users might eventually need to download a new, separate application.
Oracle’s Expanded Role
This deal significantly expands Oracle’s existing partnership with TikTok. Oracle Chairman Larry Ellison has a close relationship with President Trump. Concurrently, Oracle announced changes to its executive leadership, with CEO Safra Catz stepping down to become vice chair of the board, and Clay Magouyrk and Mike Silica appointed as co-CEOs.
Financial Considerations
The White House has not yet finalized whether it will seek a fee for its role in negotiating the deal, which is projected to be worth billions of dollars. Officials have clarified that the White House will not hold a “golden share” or any other equity stake in the new company.
Outlook
The agreement represents a significant step in resolving the contentious debate over TikTok’s presence in the U.S., aiming to mitigate national security risks while allowing the popular platform to continue operating under American oversight.
