President Donald Trump has signed an executive order approving a proposed divestiture of TikTok's U.S. operations from its Chinese parent company, ByteDance, to a consortium of American and global investors.
The move values the new U.S.-based TikTok entity at approximately $14 billion—significantly lower than previous analyst estimates of $30-40 billion for the standalone U.S. business. The order certifies the deal as a "qualified divestiture" under the 2024 Protecting Americans from Foreign Adversary Controlled Applications Act (PAFACA), which mandated ByteDance to sell or face a nationwide ban by January 2025.
The $14 billion figure, announced by Vice President JD Vance, reflects the U.S. operations' standalone value without full access to ByteDance's global assets. No specific purchase price was disclosed, but it's seen as a bargain for buyers given TikTok's revenue potential (estimated at $10-15 billion annually in the U.S.).
A major sticking point, TikTok's proprietary recommendation algorithm—credited for its addictive user engagement—will be controlled by the U.S. entity. ByteDance may license it rather than sell outright, subject to Chinese export approvals. This addresses fears of Beijing using the app for data harvesting or propaganda.
Security Measures: Oracle will oversee data security and build U.S.-based data centers. The new company will have a seven-member board, with six Americans focused on cybersecurity and national security.