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TikTok Finalizes Majority US-Owned Joint Venture Deal; Posts Details

A deal is set on a joint venture (TikTok USDS Joint Venture LLC) to acquire TikTok's U.S. assets from Chinese parent company, ByteDance.

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One day before what would've been the next in a series of "deadlines" imposed by the Trump Administration, a deal has been finalized on a joint venture (TikTok USDS Joint Venture LLC) to acquire TikTok's U.S. assets from the app's Chinese parent company, ByteDance. CEO Adam Presser and Chief Security Officer Will Farrell will take the lead on the joint venture, with both having been directly involved in securing Americans' user data in the United States. A board is in place to oversee operations, comprising TikTok US CEO Shou Chew; Kenneth Glueck, EVP, Office of the Chief Executive Officer, Oracle; representatives of investment firm Susquehanna International Group, private equity firm Silver Lake, and Emirati investment firm MGX, and others.

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Image: Stone / UK – October 25 2019: TikTok app logo on a smartphone screen and flags of China and United States. Tiktok WeChat are banned. Apps are in centre of US – China tensions and security concerns. (shutterstock.com/Ascannio)

Under the terms of the agreement, control of TikTok's US user data and most of its US operations will move to this new joint venture, 50% of which will be owned by a consortium of investors comprised of tech company Oracle, private equity firm Silver Lake, and Emirati-backed investment firm MGX. Just over 30% of the joint venture will be held by "affiliates of certain existing investors in ByteDance," and 19.9% will be retained by ByteDance (based on a memo Chew sent to employees in December).

In addition, the new joint venture is expected to retrain TikTok's algorithm on US user data, with Oracle overseeing storage of American users' data, and being responsible for moderating for US users' content. In terms of e-commerce, advertising, and marketing on the new US platform, the ByteDance-controlled global TikTok will maintain that responsibility. The new joint venture will continue to license the TikTok algorithm from ByteDance, then retrain and review it.

It remains to be seen what impact the change will have on current subscribers' streaming experience. There are also concerns over whether the new joint venture adequately addresses the initial security concerns that led to TikTok being under the U.S. government's microscope under President Joseph Biden and Trump. More details on TikTok USDS Joint Venture LLC are available on the new joint venture's website.

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Ray FlookAbout Ray Flook

Serving as Television Editor since 2018, Ray began five years earlier as a contributing writer/photographer before being brought onto the core BC team in 2017.
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