The New TikTok Deal (and What It Means for You)

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Photo by Luxe Palmer

By Luxe Palmer, Co-Editor-in-Chief

TikTok, the uber-popular social media app that has quite succinctly taken the world by storm, has recently come under fire from President Trump. Earlier in the summer of 2020, Trump expressed concerns about the app’s safety; the app is owned by Chinese-based company ByteDance, and insinuations of data theft lead the president to consider wholly banning the app from American app stores. TikTok has denied all allegations regarding data theft, but that did not deter Trump from continuing with his plan.

With massive protests from TikTok’s extensive userbase of over 100 million, Trump announced in July that he would ban the app– unless an American-based company bought the American rights and data storage of TikTok. This lead to a mass bidding battle for the rights, which could prove unimaginably profitable for the winner. Contestants included Amazon, Microsoft, and Oracle, among others.

On September 14, Oracle announced that they had bought what seemed like all of the American rights to TikTok, coming as a fair shock to audiences. Some have theorized that Oracle won over the mega-companies such as Microsoft due to their close ties with and support given by Trump.

Fans of the app received another confusing shock on Friday, September 18, when the US Commerce Department announced that TikTok would be unavailable to download beginning on September 20. According to the news release, the app would still function for those who had already downloaded it. A discussion between Trump and Oracle in October would determine whether the app would be completely banned at that date or be reopened to the public.

Waking up on September 20, one would still find the TikTok app available to download in the app stores. A literal last-minute deal with Trump, TikTok, Oracle, and, believe it or not, Walmart saved the app from future banishment. But… did this deal actually solve any of Trump’s initial worries? The hashed-out deal lead to the birth of TikTok Global, the conglomerate overseeing all TikTok data, users, security, privacy, profits, and more. TikTok owns 80% of TikTok Global, with Oracle and Walmart splitting the other 30%.

Does this answer Trump’s concerns, though? As for leadership, four of the five boardmembers are American representatives, with the fifth being a Chinese representative, who will most likely be ByteDance and TikTok founder Zhang Yiming. But according to press releases from both ByteDance and Oracle, there seems to be some confusion about the power distribution. Oracle stated that “Americans will be the majority and ByteDance will have no ownership in TikTok Global.” Walmart also announced that they would be overseeing 20% of the new conglomerate, which contradicts the original agreement of 30% shared between Walmart and Oracle. ByteDance, on the other hand, claimed that they would own 100% of TikTok Global. Addressing this absolute mess, Trump stated that “if we find that [Oracle and Walmart] don’t have total control, then [the Trump administration is] not going to approve the deal.”

A person involved with the deal stated that TikTok Global would be 53% owned by Oracle and Walmart and 36% and 11% being held by ByteDance’s Chinese and international investors, respectively. ByteDance itself would not own any part of TikTok Global. Oracle would also review the app’s codes and algorithm, as well as storing all data from the users.

It’s uncommon to have the president so deeply and personally involved in a standard deal such as this. Trump has made it clear he is the “powerbroker” in this decision, declaring that it won’t go through without his express approval. Governments do typically mediate pending deals, to ensure safety and to regulate monopolies within industries. Trump’s involvement ties back to the theory that he and Oracle cofounder Larry Ellison are friendly, due to Ellison’s support and Oracle CEO Safra Katz’s donation to his re-election campaign.

There’s more. After the September 20 deadline passed, all was calm in the realm of TikTok. But all was not as it seemed: rumors began to arise that TikTok would (yet again) be banned Sunday, September 27. Before the dreaded time of banishment, however, federal Judge Carl Nichols temporarily blocked the order, citing Constitutional freedom of speech and due process rights. Judge Nichols also granted TikTok an injunction, which restrains Trump from infringing on the rights of ByteDance.

What does this mean for you?

The official date for either the banishment or renewal of TikTok is now November 12. If the companies do not reach a solid agreement that the federal government approves, TikTok may be deleted from all American app stores. Until then, TikTok and all its users are safe to operate as usual. It is unknown what will happen to users that have already downloaded the app come November, but a common hypothesis is that they will be unable to access their account after the deadline.

According to a poll taken on Instagram (@prhs_bear_truth), over 63% of students use TikTok, usually on a daily basis. Its main purpose is for entertainment, but some students use it to post their own videos, edit media, or take part in activism.

If you are concerned about losing your TikTok videos, Instagram released a TikTok lookalike called Reels over the summer. Many TikTok users are now transferring their videos to the new platform in an attempt to secure their work. Other apps, such as Triller, have also become landing bases for migrating TikTokers.