The company announced Tuesday that its US service is now part of the separate TikTok USDS Joint Venture LLC, with parent company ByteDance holding just a 19.9 percent stake in that new entity. The rest is owned by Oracle and investment firms Silver Lake and MGX, as well as smaller investors including Michael Dell’s family investment firm. Oracle will store US data and the joint venture will “retrain, test, and update the content recommendation algorithm on U.S. user data.” The new entity will also “have decision-making authority for trust and safety policies and content moderation.”
The sparse details in the press release shed little light on outstanding questions from the time that the deal was first announced, such as whether a licensing agreement for the algorithm can be crafted in a way that avoids the sort of relationship with ByteDance that would be prohibited by the law. Even lawmakers who supported the bill seem to be in the dark. “Does this deal ensure China does not have influence over the algorithm? Can the parties involved assure Americans their data is secure?” House Select Committee on China Chair John Moolenaar (R-MI) asked in a statement following the deal’s closure. “Those are questions that need to be answered as the Select Committee does oversight of this deal.”
Select Committee Ranking Member Ro Khanna (D-CA), one of the few lawmakers who opposed the initial bill and introduced another to repeal it, said in a statement that the deal “is once again causing uncertainty among many creators.” Khanna pledged to engage with people whose livelihoods depend on the app “to find the best way forward and to prevent changes that could disrupt the rapidly growing creator economy while prioritizing data security.”
Sen. Ed Markey (D-MA), who voted to approve the foreign aid package that included the divest-or-ban bill, later sought to create a legal extension for a deal to get done. President Donald Trump flouted the original bill’s deadlines anyway, and Markey later proposed calling off the ban legally. Now that a deal has been reached, Markey said in a statement, “this TikTok deal raises many more questions than answers.”
Trump has played a significant role in how the negotiations have played out, talking about the TikTok deal with China’s President Xi Jinping, and at one point bantering at a press conference with Oracle chairman Larry Ellison that they could “negotiate in front of the media” over the deal. Markey griped that the White House “has provided virtually no details about this agreement, including whether TikTok’s algorithm is truly free of Chinese influence,” despite repeated requests for details. The White House and TikTok did not immediately respond to requests for comment. “This lack of transparency reeks,” Markey said. “Congress has a responsibility to investigate this deal, demand transparency, and ensure that any arrangement truly protects national security while keeping TikTok online.”
Adding to the frustration for many Democrats is the fact that some of Trump’s close allies, like Ellison, stand to gain from the arrangement. “This ‘deal’ helps Trump’s rich friends get richer in exchange for turning TikTok into a propaganda machine for the White House,” Energy and Commerce Committee Ranking Member Frank Pallone (D-NJ), who supported the initial bill, wrote on X. “The sparse information provided doesn’t address serious concerns about compliance with the law or address the national security threat posed by Beijing’s continued control of the platform.”
Source: www.theverge.com
