In a significant development in the ongoing saga surrounding the popular video-sharing app, U.S. President Donald Trump announced a framework agreement that would allow TikTok to continue operating within the United States, effectively averting a threatened ban. The deal, reached after months of tense negotiations involving the U.S. and China, is set to transfer TikTok’s American operations to U.S. ownership, addressing long-standing national security concerns. This breakthrough announcement came just before a critical deadline, marking a pivotal moment in the relationship between the two global economic powers and the future of a platform used by millions of Americans.
Key Players and the Proposed Structure
The agreement, announced by President Trump, involves a consortium of U.S. companies poised to take a significant stake in TikTok’s U.S. operations. Tech giant Oracle and retail behemoth Walmart are central to this proposed transaction. Oracle is slated to become TikTok’s “trusted technology provider,” responsible for hosting all U.S. user data on its cloud infrastructure and reviewing the app’s source code to address security vulnerabilities. Walmart is expected to take a smaller stake and contribute its expertise in e-commerce, fulfillment, and payments. Under the proposed framework, ByteDance, TikTok’s Chinese parent company, would reduce its ownership stake to below 20 percent, specifically 19.9 percent, to ensure majority American control and comply with U.S. regulations. Other U.S. investors, including venture capital firms like Andreessen Horowitz and Silver Lake, as well as existing ByteDance investors, are also reportedly involved in the buyout. This new U.S. entity, tentatively named TikTok Global, would also feature an American-dominated board of directors.
Addressing National Security Concerns
The Trump administration’s aggressive stance against TikTok stemmed from deep-seated national security fears. Lawmakers and intelligence officials voiced concerns that the Chinese government could potentially compel ByteDance to share sensitive data on U.S. users or use the platform to conduct influence operations and spread disinformation. These anxieties were amplified by China’s 2017 National Intelligence Law, which requires Chinese companies to assist in intelligence gathering when requested by the government. To mitigate these risks, the proposed deal emphasizes placing U.S. user data under the control of an American company like Oracle, aiming to shield it from foreign access. However, questions have lingered about the extent to which ByteDance would truly relinquish operational control and whether the inclusion of Chinese algorithmic technology would adequately address all security implications.
A History of Deadlines and Legal Battles
The path to this agreement has been fraught with challenges, including multiple executive orders and legal battles. President Trump initially issued executive orders aimed at banning TikTok in 2020, citing national security and data privacy grounds. These orders faced significant opposition, leading to lawsuits filed by TikTok arguing that the bans violated First Amendment rights and were politically motivated. Courts repeatedly blocked the enforcement of these bans, often citing a lack of demonstrated risk to national security or the arbitrary nature of a full shutdown. The Trump administration repeatedly extended deadlines for ByteDance to divest its U.S. operations, with the latest deadline being September 17, 2025, before this new framework agreement was announced. A 2024 law, passed under the Biden administration, also mandated divestiture, adding further pressure on ByteDance.
The Algorithm Dilemma and Future Steps
A significant sticking point throughout the negotiations has been the control and licensing of TikTok’s highly effective recommendation algorithm, widely considered the engine of its success. China indicated a willingness to license the algorithm and other intellectual property to the U.S. operation, but U.S. officials, including members of the House Select Committee on China, warned that any deal retaining Chinese algorithm control would violate divestiture laws and US requirements for ByteDance to have no operational control. The framework agreement appears to move towards licensing this technology while seeking to ensure American operational control. President Trump indicated he would finalize the details with Chinese President Xi Jinping, highlighting the need for presidential-level approval to cement the accord. The news provided a sense of relief for TikTok’s estimated 170 million U.S. users, but the complex details surrounding algorithmic control and long-term data security remain subjects of ongoing scrutiny, underscoring the delicate balance in U.S.-China technological relations.
This framework deal represents a critical step in resolving the TikTok controversy, though the full implications and the ultimate structure of the new entity will be closely watched. The agreement, hailed as a “win-win solution” by Chinese state media, signals a continued, albeit complex, engagement between the U.S. and China on critical technology issues affecting the global news landscape.
