In a landmark resolution to a prolonged geopolitical standoff, TikTok has successfully established a majority American-owned joint venture to continue operating its US business, effectively neutralizing the threat of a nationwide ban. The newly formed entity, TikTok USDS Joint Venture LLC, will serve the platform’s massive American user base of over 200 million users and 7.5 million businesses while implementing rigorous new protocols for data security, algorithmic transparency, and content moderation.
The corporate restructuring directly responds to legislation passed during the Biden administration that mandated Chinese parent company ByteDance divest its US operations or face prohibition in its largest market. The complex agreement, which largely confirms an outline presented to staff last month, stipulates that ByteDance will retain a 19.9 percent stake in the venture—strategically remaining below the critical 20 percent threshold specified by US law.
Significant American investment firms form the venture’s backbone, with Silver Lake, Oracle, and Abu Dhabi’s AI investment fund MGX each acquiring 15 percent stakes. Additional investors include Dell Family Office, affiliates of Susquehanna International Group, General Atlantic, and several other established financial institutions. Notably, Oracle’s executive chairman Larry Ellison, a longtime ally of former President Donald Trump, plays a pivotal role in the arrangement.
The joint venture will maintain autonomous decision-making authority over all US trust and safety policies and content moderation, while TikTok’s global entities will continue managing international product integration and commercial activities including advertising and e-commerce. Under the new structure, all US user data will be securely housed within Oracle’s cloud environment, subject to independent cybersecurity audits and strict adherence to federal standards.
Governance will be administered by a seven-member board with American majority representation, including TikTok CEO Shou Chew and executives from major investment firms. TikTok veteran Adam Presser has been appointed CEO of the new entity, with Will Farrell assuming the role of chief security officer.
The resolution prompted immediate political reactions, with former President Trump publicly thanking Chinese President Xi Jinping for approving the arrangement. ‘I am so happy to have helped in saving TikTok!’ Trump declared in a post on Truth Social. ‘I would also like to thank President Xi, of China, for working with us and, ultimately, approving the Deal.’
The 2024 legislation emerged from longstanding bipartisan concerns among US policymakers that China could potentially exploit TikTok to harvest American user data or exert influence through its powerful algorithm. However, Trump, who has credited the platform with bolstering his appeal among younger voters, repeatedly delayed enforcement through executive orders, most recently extending the deadline to January 22.