Tiktok Completes Deal to Separate US App From Global Operation

TikTok has finalised an agreement that will allow the short-video platform to continue operating in the United States by formally separating its US business from its global operations.

The deal follows years of tension between Washington and Beijing over national security concerns tied to TikTok’s Chinese parent company, ByteDance. US lawmakers have argued that ByteDance could be compelled by Chinese authorities to hand over American user data, claims consistently denied by both TikTok and ByteDance.

Under legislation passed in 2024, ByteDance was required to divest TikTok’s US operations or face a nationwide ban by January 2025. Enforcement of the law was delayed several times by President Donald Trump, creating space for extended negotiations. During the legal standoff, TikTok briefly went offline for US users before services were restored.

A key sticking point in the negotiations was TikTok’s recommendation algorithm, which determines the content shown to users. Under the new arrangement, the algorithm has been licensed to the US entity and will be retrained exclusively using American user data. All US data will be stored and managed domestically.

TikTok said the platform will now be operated by a newly established company, TikTok USDS Joint Venture LLC, which will function independently from the global business. The entity will be overseen by a seven-member board, the majority of whom are American. Former WarnerMedia executive Adam Presser has been appointed chief executive.

Ownership of the US operation is shared among several investors. Oracle, Silver Lake and Abu Dhabi-based tech investor MGX each hold 15 percent stakes, while ByteDance retains a 19.9 percent minority share. Oracle will be responsible for data security and for managing the algorithm through its US cloud infrastructure.

The remaining shares are held by other investors, including affiliates of Michael Dell and Susquehanna International Group. TikTok’s global chief executive, Shou Zi Chew, will also serve on the board.

Industry analysts say the separation and retraining of the algorithm could alter how the app functions for American users. While the platform is expected to meet US regulatory requirements, experts caution that content recommendations and overall performance may differ from TikTok’s global version.