TikTok Strikes U.S. Joint Venture to Avoid Ban

TikTok has secured a lifeline in the United States after signing a joint venture deal that allows the social media platform to continue operating in its biggest market while addressing concerns over its Chinese ownership.

According to an internal memo seen by AFP, TikTok CEO Shou Chew confirmed that ByteDance, TikTok’s parent company, will partner with Oracle, private equity firm Silver Lake, and Abu Dhabi-based MGX to form a new U.S.-focused entity.

Chew outlined in the memo that the U.S. venture will oversee data protection, algorithm security, content moderation, and software assurance for American users. “It will also have the exclusive right and authority to provide assurances that content, software, and data for American users is secure,” he said.

The deal splits ownership roughly as follows: Oracle, Silver Lake, and MGX will each hold 15%, existing ByteDance investors just over 30%, and ByteDance itself will retain just under 20%, meeting legal limits for Chinese ownership in the U.S.

TikTok’s U.S. entities will also manage certain global functions, including e-commerce, advertising, and marketing, while ensuring interoperability with TikTok’s global products. The closing date for the deal is set for January 22, 2026, according to the memo.

Political Context and Regulatory Pressure

The joint venture is a direct response to U.S. legislation aimed at protecting American user data from foreign influence. Policymakers, including former President Donald Trump, have repeatedly raised concerns that China could use TikTok’s platform to collect data or sway public opinion. Trump’s administration extended deadlines multiple times, most recently into January 2026, allowing ByteDance to negotiate a compliant structure.

Also read: Trump Allies to Take Control of TikTok Under New US Deal

The arrangement also involves Oracle founder Larry Ellison, a known ally of Trump, who has taken on a major role in the U.S. venture. Ellison’s involvement has drawn attention, given his broader media investments and ongoing AI projects with OpenAI.

ByteDance Perspective and Industry Implications

Experts say the deal represents a compromise that preserves TikTok’s presence in the U.S., one of its most lucrative markets. Li Chengdong, founder of Chinese tech consultancy Dolphin, called it “a victory” for ByteDance, allowing the company to shift focus toward AI projects and a potential IPO.

Zhang Yi of iiMedia cautioned, however, that the U.S. regulatory environment remains complex. “The U.S. side could still leverage its power to impose unexpected demands,” he said, suggesting that TikTok’s journey in America may remain closely scrutinized.

The deal signals a delicate balancing act between global expansion, regulatory compliance, and political realities, ensuring that TikTok can continue to operate in the U.S. while satisfying lawmakers and investors.