President Donald Trump will sign off on a deal later this week that will give greater control over TikTok’s U.S. algorithm to a consortium of American investors, a senior White House official told the Daily Caller News Foundation.
American and Chinese officials reached a “compromise” designed to satisfy both U.S. and Chinese legal requirements, the White House official said. Under the proposal, Oracle is to be provided with the TikTok recommendation algorithm — a “tough point of negotiation,” according to the official — and protect information and data on American users under the new U.S. venture.
Congress passed a law in April 2024 requiring TikTok’s China-based parent company, ByteDance, to divest its U.S. assets within a year or face shutdown, citing national security risks. The president has already extended the deadline multiple times this year, including earlier this month.
Under the deal, a “copy” of TikTok’s algorithm will be created for the U.S. venture, which will be “fully inspected and retrained” by Oracle using U.S. user data and stored on Oracle servers in the U.S., which already stores TikTok user data, the White House official said. The U.S. venture itself will “operate and control” the algorithm, the official said. (RELATED: TikTok Puts News Outlet In Time Out For Posting Charlie Kirk News)
WASHINGTON, DC – JANUARY 20: Shou Zi Chew (C), the CEO of TikTok, arrives to attend the United States Capitol on January 20, 2025 in Washington, DC. (Photo by Shawn Thew-Pool/Getty Images)
“An algorithm is nothing more than a mathematical formula with a set of weights, and it’s the data that’s being run through the algorithm that leads to the outputs of content recommendation,” the official said. “By moving the algorithm itself — a formula — into the U.S. and then running it on U.S. data, we feel that that is the appropriate way … to make sure that the algorithm is behaving appropriately and is secure, and it is something that we think complies with all the relevant laws and policies on both sides.”
ByteDance will retain less than 20% equity in the U.S. operations, while “a mixture of U.S. and global firms who are already invested in ByteDance — basically, existing investors — as well as a significant number of new investors who have no affiliation with ByteDance,” will hold the remaining shares, according to the White House official.
The president said on Sunday that Fox Corp. founder Rupert Murdoch and his son Lachlan are likely to be involved in the TikTok deal.
There will be no government-appointed board members in the new entity, no “golden share,” and the U.S. government will not hold equity in the venture, according to the official.
The president is expected to sign an executive order later this week affirming that its terms meet U.S. national security needs. He will also extend the enforcement pause for 120 days to allow the company and investors to finalize all implementation documents, complete regulatory reviews in both the U.S. and China, and formally close the deal, the official said.
“The president and the Vice President Vance have negotiated another outstanding deal on behalf of the American people, one that saves TikTok for over 170 million U.S. users while making sure that it’s safe and secure,” the official said.
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