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U.S. to Regulate TikTok’s Algorithm, Announces White House

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Home Business U.S. to Regulate TikTok’s Algorithm, Announces White House

TikTok’s Algorithm To Be Controlled By U.S., White House Says

Topline

TikTok’s algorithm and board of directors will be “controlled by America” as part of a deal reached with China earlier this week, White House press secretary Karoline Leavitt said Saturday, following earlier disputes from ByteDance, TikTok’s China-based parent firm.

President Donald Trump signaled a deal to keep TikTok online in the U.S. was “approved” by China.

Key Facts

Leavitt, in a Saturday morning appearance on Fox News, said six of the seven board seats for TikTok’s U.S. entity will be occupied by Americans, who will also oversee the platform’s algorithm.

Leavitt said Oracle, the cloud computing firm headed by billionaire Larry Ellison, would lead TikTok’s “data and privacy,” after earlier reports suggested Oracle would be among an investing consortium with a controlling stake and control user data at its facilities in Texas.

She also confirmed a deal was reached with Chinese officials to keep TikTok available in the U.S., after China’s foreign ministry did not explicitly confirm a deal was reached while President Donald Trump said Chinese President Xi Jinping gave “approval.”

The deal is expected to be signed “in the coming days,” Leavitt said.

What Has Bytedance Said About Tiktok’s Algorithm?

ByteDance has repeatedly opposed separating from TikTok’s algorithm, arguing in court filings that control of the algorithm is necessary for the platform to function normally. ByteDance has claimed divesting from TikTok would “imperil the algorithm’s future functionality” and “fundamentally alter the content TikTok Inc. offers.”

What Do We Know About The Tiktok Deal?

Specifics of a deal reached between U.S. and Chinese trade representatives have not been publicly revealed. Jamieson Greer, the U.S. trade representative, said terms were “fair for the Chinese” and respected national security concerns in the U.S. China’s top trade negotiator, Li Chenggang, said in a statement the U.S. and China agreed on a “framework” that included resolving “issues related to TikTok through cooperation, reducing investment barriers and promoting relevant economic and trade cooperation.” Oracle, Marc Andreessen’s venture capital firm Andreessen Horowitz and the private equity Silver Lake are expected to hold a roughly 80% stake as part of the deal. One of the new U.S. entity’s board members is also expected to be designated by the U.S. government.

Key Background

Trump on Friday thanked Xi for “the TikTok approval” in his latest phone call with Chinese leadership. The Chinese foreign ministry indicated Xi had addressed talks over the sale of TikTok with Trump, suggesting the Chinese government “respects corporate decisions” and “welcomes business negotiations that follow market rules and produce solutions consistent with Chinese laws and balanced interests.” The statement did not explicitly say whether Xi approved the deal, noting Xi had instead requested Trump to avoid imposing “unilateral trade restrictions” on China. Negotiations to prevent TikTok from going dark in the U.S. appeared to speed up in recent months, as Trump has delayed a nationwide ban on the app four times.