The upcoming change of power in the United States is preparing another intrigue concerning the fate of the Chinese social network TikTok in this country. The law banning its operation in the United States may come into force any day now, and President-elect Donald Trump is not against preserving this platform. The Chinese side expects to sell the local business to Elon Musk if TikTok is banned in the United States.
The American billionaire is not only the richest man on the planet and a close associate of Trump, but also the owner of the social network X, which was known as Twitter before he bought it in 2022. Musk should understand the problems of the social network, and he is expected to be ready, out of solidarity with Trump, to somehow preserve the legacy of TikTok for American users.
However, the main priority for the Chinese ByteDance, which owns TikTok, is still maintaining control over its American assets. After the preliminary hearing on January 10, it became clear that the American justice system is generally inclined to support the ban on TikTok in the US unless ByteDance agrees to transfer the necessary infrastructure to the control of an American company. In the event of the sale of TikTok’s assets in the US, the Chinese government should also have some influence on this deal. The latter party is considering an option according to which TikTok’s assets in the US would come under the control of Musk’s company X, and the social networks themselves would undergo mutual integration. TikTok has 170 million users in the US, and X certainly does not want to squander such an audience, according to the authors of the idea. In addition, the data arrays generated by TikTok could be useful to xAI, another Musk company that specializes in artificial intelligence. We’ll keep you updated.
In April last year, Musk spoke in favor of keeping TikTok in the US, although such measures would help X lure users to its side. The head of X considers the ban on TikTok a serious attack on freedom of speech in the US. The Chinese authorities are ready to use Trump’s interest in maintaining access to TikTok for American users as a bargaining chip in negotiations on other topics. The Chinese government has voting rights in the capital of one of ByteDance’s related structures, so it is legally able to influence the fate of the company. Moreover, the Chinese authorities prohibit the export of sensitive technologies without their approval, and TikTok owns a valuable recommendation algorithm that they do not want to cede to foreigners, adds NIXsolutions.
Legal Maneuvers and Chinese Interests
According to last year’s estimates, TikTok’s assets in the United States could be worth between $40 and $50 billion. Musk paid about $44 billion for Twitter in 2022, but considered this price too high and tried in every possible way to knock it down until the last moment. It will also not be very easy for Musk to pay comparable money for TikTok’s American business. In addition, separating TikTok’s business in the United States from the main one will be difficult from a legal point of view, and this will take a decent amount of time.
ByteDance’s management is determined to defend its interests in court, and considers selling TikTok’s assets in the US as a last resort. One alternative involves moving the US version of TikTok to a new app along with its users, but it is unlikely that such a decorative transformation will satisfy the US authorities.