TikTok has finalised a deal that secures the future of its short-video platform in the United States. The company confirmed the agreement on Thursday after years of political uncertainty.
The deal ends a prolonged confrontation between Washington and Beijing. The dispute began during Donald Trump’s first presidency, when he tried to ban the app over national security concerns.
US legislation threatened a shutdown in January 2025 unless ByteDance sold TikTok’s American operations. Trump later delayed enforcement several times after returning to office.
The central issue involved TikTok’s recommendation algorithm. Under the agreement, American owners now license the technology. The system will train only on data from US users.
Experts expect changes to the app’s performance. The long-term effect on roughly 200 million American users remains unclear.
Years of tension lead to a forced separation
US officials have pressed TikTok for years to cut ties with ByteDance. Lawmakers linked their demands to concerns about Chinese ownership.
They warned that Beijing could compel the company to hand over American user data. TikTok and ByteDance consistently rejected those claims.
Trump first raised the idea of banning TikTok in 2020. The proposal gained traction during Joe Biden’s presidency. In 2024, Biden signed a law ordering ByteDance to sell or face a nationwide ban.
ByteDance challenged the law in court. In January last year, TikTok briefly disappeared from US app stores and services. The outage lasted between 12 and 14 hours.
Service resumed after Trump, then president-elect, promised to reverse the ban. Later that year, Trump said he reached an understanding with China to keep TikTok running.
In December, TikTok signed binding agreements with American and international investors. Chief executive Shou Zi Chew confirmed the move in an internal memo.
TikTok later released further details. The agreement establishes TikTok USDS Joint Venture LLC. The new entity will protect user data, apps and algorithms through strict privacy and cybersecurity standards.
New company, new power balance
TikTok says the joint venture will operate as an independent business. A seven-member board with a majority of American directors will govern the company.
Adam Presser, a former WarnerMedia executive, now leads the venture as chief executive. Three managing investors each control 15% of the US business.
Oracle plays a central role in the structure. The cloud computing firm is chaired by Larry Ellison, a major Republican donor and Trump ally. Silver Lake also participates in the deal. The US investment firm manages around $116bn in assets. MGX, an Emirati investor focused on AI and technology, completes the group.
Oracle will secure data belonging to American users. The company will also oversee retraining of the recommendation algorithm.
ByteDance retains a 19.9% stake in the venture. A group of investors owns the remaining 35.1%. This group includes the family office of Michael Dell and Vastmere Strategic Investments. Vastmere operates as an affiliate of Susquehanna International Group.
Susquehanna co-founder Jeff Yass remains a Trump ally. His personal stake in ByteDance stood near 7% last year. Susquehanna managing director Mark Dooley will sit on the board.
Shou Zi Chew will also serve as a board member. Executives from Oracle, Silver Lake and MGX will join him.
The algorithm that changed everything
TikTok’s algorithm remains the core issue behind the US deal. Industry observers often describe it as the platform’s most valuable asset.
A former social media executive previously said competitors failed to copy its effectiveness. Features like Instagram Reels and YouTube Shorts never matched its performance. Early innovators, he argued, usually understand their technology best.
ByteDance initially refused to release the algorithm. Chinese authorities supported that stance. In September, China’s top cybersecurity regulator signalled a policy shift. Officials suggested they could allow ByteDance to license the system to an American-controlled company.
Under the agreement, the algorithm will rely exclusively on US user data. That data must comply with American regulatory requirements. TikTok said Oracle will secure the system inside its US-based cloud infrastructure.
US users are expected to notice changes soon. Experts predict a lighter and possibly slower app. They also warn that content recommendations may lose some precision.
