- Trump signed an executive order Thursday approving a $14B deal to keep TikTok operating in the U.S.
- Oracle, Silver Lake, and MGX will control ~45% of TikTok U.S., with ByteDance retaining less than 20% if China agrees.
- The deal avoids an immediate ban but leaves questions around algorithm control, valuation gaps, and Beijing’s final approval.
- Analysts say the $14B valuation undercuts estimates of $30–40B, suggesting concessions were made to secure political sign-off.
- For advertisers, TikTok remains open—for now—but regulatory and geopolitical uncertainty still clouds long-term planning.
A White House order approves a joint-venture plan, but China’s sign-off remains critical.
On Thursday, President Donald Trump signed an executive order that effectively rescues TikTok from a looming U.S. ban, approving a proposed joint-venture deal that values the app’s U.S. operations at $14 billion. The move halts, at least temporarily, the enforcement of a 2024 national security law that mandated TikTok’s Chinese parent, ByteDance, divest its U.S. business or face a nationwide shutdown.
Trump presented the order as a win for both U.S. users and national security. “This is going to be American-operated all the way,” he told reporters, noting that Oracle, Silver Lake, and Abu Dhabi–based MGX will be among the principal investors. ByteDance’s ownership is capped at under 20%, pending Beijing’s approval.
The Valuation Controversy
Vice President JD Vance confirmed the new U.S. entity’s valuation at $14 billion, a figure that immediately drew scrutiny. Analysts had pegged TikTok’s U.S. business at $30–40 billion without its prized recommendation algorithm, raising questions about what compromises were made to secure consensus between Washington and Beijing.
Wedbush Securities analyst Dan Ives called the valuation “a steep discount,” while others pointed out that ByteDance itself recently valued its broader business at more than $330 billion.
The gap highlights the tension between political expediency and market reality.
Algorithm Control at the Center
The deal attempts to address U.S. lawmakers’ core concern: Algorithmic influence and data security. According to Trump’s executive order, TikTok’s algorithm will be retrained on American data, overseen by Oracle and other security partners. However, legal experts note the order leaves critical details unresolved.
Alan Rozenshtein, professor at the University of Minnesota Law School, argued,
“The problem is that the president has certified the deal, but he has not provided a lot of information on the algorithm.”
Reports in Chinese media, later removed, suggested ByteDance may still retain a role in global operations and revenue streams, further muddying the picture.
Political and Geopolitical Dimensions
Trump emphasized that Chinese President Xi Jinping had personally given the arrangement a green light: “We had a good talk, I told him what we were doing and he said go ahead with it.” But Beijing has not publicly confirmed its approval, and China’s foreign ministry struck a more measured tone, urging the U.S. to ensure “an open, fair and non-discriminatory business environment.”
At the same time, several U.S. lawmakers signaled skepticism. Republican representatives Brett Guthrie, Gus Bilirakis, and Richard Hudson issued a joint statement warning that the deal must “Protect American users from the influence and surveillance of CCP-aligned groups.”
Implications for Advertisers and Brands
For marketers, the immediate crisis appears averted. TikTok’s 170 million U.S. users remain accessible, preserving one of the most valuable channels for reaching younger demographics. Yet the turbulence underscores ongoing risks for ad budgets and brand safety strategies.
As one advertising executive put it privately, “We can breathe easier for now, but no one is writing five-year TikTok plans until China formally signs off.”
What Comes Next
The Department of Justice has paused enforcement of the national security law until December 16, giving negotiators time to finalize details and await China’s response. The new TikTok U.S. entity will feature a seven-member board, six of whom will be Americans, with ByteDance appointing the seventh.
Until then, TikTok’s U.S. future remains suspended between political maneuvering in Washington and regulatory decisions in Beijing.
