{"id":10460,"date":"2025-12-20T11:05:49","date_gmt":"2025-12-20T11:05:49","guid":{"rendered":"https:\/\/readtrends.com\/en\/tiktok-trump-allies-deal\/"},"modified":"2025-12-20T11:05:49","modified_gmt":"2025-12-20T11:05:49","slug":"tiktok-trump-allies-deal","status":"publish","type":"post","link":"https:\/\/readtrends.com\/en\/tiktok-trump-allies-deal\/","title":{"rendered":"TikTok Deal Transfers U.S. Control to Trump Allies, Oracle Named Security Partner"},"content":{"rendered":"<article>\n<p><strong>Lead:<\/strong> TikTok and its Chinese parent, ByteDance, have reached binding agreements to form a new U.S. joint venture that will be majority\u2011owned by American investors, officials and media reported. The transaction, slated to close on Jan. 22, would allow TikTok to continue operating in the United States after a law threatened a ban unless ByteDance divested U.S. operations. The accord grants U.S. investors\u2014led by Oracle, Silver Lake and Abu Dhabi\u2019s MGX\u2014significant governance roles, and assigns Oracle responsibility for security auditing. The arrangement shifts oversight of moderation and recommendation systems away from ByteDance while leaving the parent company with a reported minority stake.<\/p>\n<h2>Key Takeaways<\/h2>\n<ul>\n<li>Binding agreements have been signed to create a U.S. joint venture expected to close on Jan. 22, allowing TikTok to remain operational in the U.S.<\/li>\n<li>Three managing investors\u2014Oracle, Silver Lake and MGX\u2014are reported to each hold 15% of the new venture, with ByteDance retaining about 20%.<\/li>\n<li>Approximately 30% of the venture will be owned by affiliates of existing ByteDance investors; the remaining 5% will be allocated to other new investors.<\/li>\n<li>Oracle is named the venture\u2019s &#8220;trusted security partner,&#8221; tasked with auditing compliance with national security terms and validating controls.<\/li>\n<li>TikTok CEO Shou Zi Chew\u2019s memo to staff referenced retraining the recommendation algorithm &#8220;to ensure the content feed is free from outside manipulation.&#8221;<\/li>\n<li>The deal responds to a 2024 law, upheld by the Supreme Court in January, that would ban TikTok absent a divestiture over national security concerns.<\/li>\n<li>Larry Ellison, Oracle\u2019s founder and an ally of former President Donald Trump, is identified as a key backer; Bloomberg lists his net worth at $233 billion.<\/li>\n<\/ul>\n<h2>Background<\/h2>\n<p>The U.S. government has scrutinized TikTok for years over data access and its ties to ByteDance, a Beijing\u2011based company. In 2020, President Donald Trump issued an executive order pushing for a divestiture of U.S. operations; congressional action followed with a 2024 law that could have forced a ban if ByteDance did not sell. That statute survived judicial review and was upheld by the Supreme Court in January, which framed a sale as necessary to mitigate national security risks tied to data collection and potential foreign influence.<\/p>\n<p>Throughout 2024 and into early 2025, lawmakers from both parties pressed for stronger safeguards, and some critics cited content\u2011moderation concerns\u2014among them comments linking support for a ban to perceived pro\u2011Palestinian content. The political pressure accelerated talks between ByteDance and potential U.S. partners, with negotiations focusing on ownership percentages, algorithm governance and security oversight. TikTok employees were briefed in a memo from CEO Shou Zi Chew outlining steps the company expects to take if the sale closes.<\/p>\n<h2>Main Event<\/h2>\n<p>According to multiple media reports and an internal memo, ByteDance and TikTok signed binding agreements that would establish a new entity to control the app\u2019s U.S. operations. The new joint venture, reported in coverage of the memo as &#8220;TikTok USDS Joint Venture LLC,&#8221; is structured to give U.S. investors a controlling share while leaving ByteDance as a minority stakeholder. The deal is reportedly structured so Oracle, Silver Lake and MGX each hold 15%, affiliates of current ByteDance investors hold roughly 30%, ByteDance retains ~20%, and the rest goes to smaller new investors.<\/p>\n<p>Oracle\u2019s role goes beyond capital: the company will act as the &#8220;trusted security partner,&#8221; charged with auditing and validating the joint venture\u2019s compliance with national security commitments. The memo highlights planned technical steps, including retraining the recommendation algorithm, moving certain data operations, and instituting audit mechanisms to demonstrate compliance to U.S. authorities. The company has not publicly confirmed every detail and did not immediately respond to requests for comment.<\/p>\n<p>The arrangement shifts some operational authority over content moderation and recommendation systems toward U.S. parties and away from ByteDance. Reported governance terms would create oversight mechanisms designed to reduce perceived risks tied to foreign control, while allowing the platform to remain accessible to U.S. users. Supporters say the structure addresses the legal requirement for divestiture; skeptics note that details and enforcement will matter for whether national security concerns are truly mitigated.<\/p>\n<h2>Analysis &#038; Implications<\/h2>\n<p>Politically, the deal represents a compromise between lawmakers determined to remove perceived foreign control and commercial actors seeking to preserve TikTok\u2019s U.S. market. By placing Oracle and other U.S. investors in managerial and auditing roles, negotiators aim to blunt the primary legal argument behind the ban: that ByteDance could access or influence data and algorithms in ways that threaten U.S. interests. How convincing that structural change is to security officials and the courts will depend on technical transparency and enforceable guarantees.<\/p>\n<p>Economically, the transaction preserves an app with more than 150 million U.S. users (platform user counts vary by source) and secures continued revenue streams for advertisers and creators. For Oracle and private equity partners, acquiring governance rights to a major social platform is a strategic bet on long\u2011term ad and commerce value\u2014and it raises questions about how investor governance will affect content decisions, product roadmaps and competition with incumbent platforms.<\/p>\n<p>On the technology front, retraining recommendation systems and establishing auditability are nontrivial tasks. Algorithms reflect training data, models and engineering choices; meaningful retraining and external validation require prolonged access to source systems and detailed logs. The effectiveness of &#8220;trusted security partner&#8221; audits will hinge on the scope of access Oracle receives and whether independent auditors can verify both code and operational practices over time.<\/p>\n<h2>Comparison &#038; Data<\/h2>\n<figure>\n<table>\n<thead>\n<tr>\n<th>Stakeholder<\/th>\n<th>Reported Share<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>Oracle<\/td>\n<td>15%<\/td>\n<\/tr>\n<tr>\n<td>Silver Lake<\/td>\n<td>15%<\/td>\n<\/tr>\n<tr>\n<td>MGX (Abu Dhabi)<\/td>\n<td>15%<\/td>\n<\/tr>\n<tr>\n<td>Affiliates of current ByteDance investors<\/td>\n<td>~30%<\/td>\n<\/tr>\n<tr>\n<td>ByteDance<\/td>\n<td>~20%<\/td>\n<\/tr>\n<tr>\n<td>Other new investors<\/td>\n<td>~5%<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/figure>\n<p>The table above summarizes the ownership breakdown reported in coverage of the memo. If accurate, the structure gives U.S.\u2011aligned investors a combined controlling interest while keeping ByteDance as a significant minority holder. The distribution is intended to balance legal, regulatory and commercial objectives: remove unilateral foreign control while preserving economic continuity for the platform.<\/p>\n<h2>Reactions &#038; Quotes<\/h2>\n<blockquote>\n<p>&#8220;[We will] retrain the recommendation algorithm to ensure the content feed is free from outside manipulation.&#8221;<\/p>\n<p><cite>Shou Zi Chew, TikTok CEO (internal memo)<\/cite><\/p><\/blockquote>\n<p>The memo line above was cited in media reporting and framed the company\u2019s proposed technical steps to meet security and content\u2011integrity expectations. Company leadership presented the move as necessary to comply with U.S. requirements while minimizing disruption to users.<\/p>\n<blockquote>\n<p>&#8220;A sale of TikTok was necessary to address national security concerns,&#8221;<\/p>\n<p><cite>U.S. Supreme Court (January ruling summary)<\/cite><\/p><\/blockquote>\n<p>The Supreme Court\u2019s ruling provided the legal backdrop that made a divestiture or a comparable transfer of control the decisive option for avoiding an effective ban under the 2024 law signed by the president.<\/p>\n<h2>\n<aside>\n<details>\n<summary>Explainer: What does &#8220;trusted security partner&#8221; mean?<\/summary>\n<p>&#8220;Trusted security partner&#8221; typically refers to an entity with privileged access and authority to audit systems, validate compliance and conduct or oversee security testing. In this context, Oracle would be expected to verify data residency arrangements, confirm access controls, and provide attestations that the joint venture adheres to agreed security commitments. The partner\u2019s independence, technical remit, and ability to publish findings are central to whether its role satisfies regulators and external auditors. Implementation requires legal agreements, technical access paths, and recurring verification rather than single one\u2011time checks.<\/p>\n<\/details>\n<\/aside>\n<\/h2>\n<h2>Unconfirmed<\/h2>\n<ul>\n<li>The reported name &#8220;TikTok USDS Joint Venture LLC&#8221; has appeared in media accounts but was not publicly confirmed by TikTok at the time of reporting.<\/li>\n<li>While ownership percentages are widely reported, the precise governance documents and regulatory filings that would legally fix those shares and control rights were not yet publicly available.<\/li>\n<li>Technical specifics of how the algorithm retraining and auditing will be executed\u2014or how independent auditors will be appointed\u2014remain unspecified.<\/li>\n<\/ul>\n<h2>Bottom Line<\/h2>\n<p>The agreement\u2014if it closes as reported on Jan. 22\u2014resolves a multi\u2011year clash between U.S. national security concerns and the commercial reality of a widely used social platform. It transfers managerial and security roles to U.S. allies and investors while keeping ByteDance in a meaningful minority position, a tradeoff that aims to satisfy a law the Supreme Court has already upheld.<\/p>\n<p>Whether the structure will withstand scrutiny will depend on enforceable, transparent technical controls and credible, sustained auditing. For users and advertisers, the immediate effect is continuity; for policymakers and security analysts, the deal shifts attention from an outright ban to long\u2011term oversight and verification.<\/p>\n<h2>Sources<\/h2>\n<ul>\n<li><a href=\"https:\/\/gizmodo.com\/tiktok-finally-strikes-deal-to-be-taken-over-by-trump-allies-2000701805\" target=\"_blank\" rel=\"noopener\">Gizmodo<\/a> (news outlet) \u2014 original reporting on the memo and deal structure.<\/li>\n<li><a href=\"https:\/\/www.bloomberg.com\/\" target=\"_blank\" rel=\"noopener\">Bloomberg<\/a> (business news) \u2014 referenced for Larry Ellison\u2019s wealth reporting and investor context.<\/li>\n<li><a href=\"https:\/\/www.supremecourt.gov\/\" target=\"_blank\" rel=\"noopener\">U.S. Supreme Court<\/a> (official) \u2014 referenced for the January ruling upholding the statutory framework requiring divestiture.<\/li>\n<\/ul>\n<\/article>\n","protected":false},"excerpt":{"rendered":"<p>Lead: TikTok and its Chinese parent, ByteDance, have reached binding agreements to form a new U.S. joint venture that will be majority\u2011owned by American investors, officials and media reported. The transaction, slated to close on Jan. 22, would allow TikTok to continue operating in the United States after a law threatened a ban unless ByteDance &#8230; <a title=\"TikTok Deal Transfers U.S. Control to Trump Allies, Oracle Named Security Partner\" class=\"read-more\" href=\"https:\/\/readtrends.com\/en\/tiktok-trump-allies-deal\/\" aria-label=\"Read more about TikTok Deal Transfers U.S. Control to Trump Allies, Oracle Named Security Partner\">Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":10456,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"rank_math_title":"TikTok Deal Hands Control to Trump Allies \u2014 NewsLab","rank_math_description":"TikTok and ByteDance struck a binding agreement to form a U.S. joint venture led by Oracle, Silver Lake and MGX, averting a ban and shifting oversight ahead of Jan. 22 closure.","rank_math_focus_keyword":"TikTok,ByteDance,Oracle,Ellison,national security","footnotes":""},"categories":[2],"tags":[],"class_list":["post-10460","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-top-stories"],"_links":{"self":[{"href":"https:\/\/readtrends.com\/en\/wp-json\/wp\/v2\/posts\/10460","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/readtrends.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/readtrends.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/readtrends.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/readtrends.com\/en\/wp-json\/wp\/v2\/comments?post=10460"}],"version-history":[{"count":0,"href":"https:\/\/readtrends.com\/en\/wp-json\/wp\/v2\/posts\/10460\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/readtrends.com\/en\/wp-json\/wp\/v2\/media\/10456"}],"wp:attachment":[{"href":"https:\/\/readtrends.com\/en\/wp-json\/wp\/v2\/media?parent=10460"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/readtrends.com\/en\/wp-json\/wp\/v2\/categories?post=10460"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/readtrends.com\/en\/wp-json\/wp\/v2\/tags?post=10460"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}