TikTok’s Sale ‘Shelved Indefinitely’ as Biden Reviews Security Issues
Rather than an outright sale, TikTok may reach a deal for a U.S. company to handle American user data
TikTok’s plan to sell its American assets to Oracle and Walmart has been “shelved indefinitely,” the Wall Street Journal reported on Wednesday, as President Biden reviews the security risks former President Donald Trump raised about the popular app and its close ties to China’s government.
Discussions between ByteDance, TikTok’s parent company, and U.S. security officials are still taking place, according to the report. But those discussions are focused on data security issues and making sure the information TikTok grabs from its American users isn’t shared with China’s government, rather than an outright sale of the app’s U.S. operations.
Reps for TikTok and the Biden administration did not immediately respond to requests for comment.
The sale proposal emerged after Trump signed an executive order last August banning TikTok unless it offloaded its U.S. operations, citing national security concerns tied to the app’s data collection policies and close ties to China’s communist government; TikTok, in response, said it never shares user data with government officials.
A month later, TikTok reached a deal with Oracle to become the app’s “trusted technology provider” in the U.S. with Oracle and Walmart taking a 20% stake in TikTok Global, a new American offshoot that would likely go public in 2021, as part of the deal. But while President Trump initially gave the deal his “blessing,” it has since remained in limbo, with a few losses in court putting the app’s forced sale on pause.
The U.S. Committee on Foreign Investment, which previously ordered ByteDance to divest its U.S. assets, is continuing to discuss compromises with TikTok, according to the Journal. But instead of a sale, possible solution include “use of a trusted third party to manage TikTok’s data.”
Still, the report said there is “no imminent decision” on how the TikTok-U.S. government standoff will be resolved, with the Biden administration currently reviewing the security concerns tied to several Chinese apps.
“Any deal would likely be different from the one discussed last September, the people said, in part because TikTok no longer faces the threat of an imminent shutdown,” the Journal added. Chinese regulators would also need to sign off on any deal, adding another layer of complexity. TikTok as of late 2020 had about 100 million users in the U.S.
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