TikTok reprieve extended by Trump as he forges agreement for a framework deal with China for the fourth time, delaying the app's shutdown.
In a significant development, the social media platform TikTok is set to undergo a major change in its US operations. According to CNN, a new consortium will be operating the app, with a majority-US board, including a member from the Trump administration.
If the planned transfer of TikTok's US assets is completed, Oracle is expected to act as a trustee, overseeing data and algorithm operations under American supervision. This arrangement would allow US authorities insight into the system's functioning, without China fully transferring its intellectual property. The Chinese algorithm and intellectual property rights will be used under strict US oversight, addressing US security concerns in a compromise.
The postponement of the original deadline, which was January 19, 2021, has provided American and Chinese officials with more time to finalize a deal regarding TikTok. This extension was necessitated by the complex nature of the negotiations.
The framework for TikTok's potential sale in the US includes licensing the Chinese algorithm and transferring intellectual property rights. Other potential shareholders in the new consortium include venture capital firm Andreessen Horowitz and global equity firm Silver Lake, in addition to Oracle.
The meeting in Madrid that led to this framework was attended by US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng, among others. Bessent stated the goal was to transfer TikTok's assets to US ownership for its operations in America, but declined to discuss the details of the framework.
Chinese officials revealed these details to the Financial Post. The US president has shown support for TikTok, believing it helped him win younger voters in the 2020 presidential election. A conversation between Trump and Chinese President Xi Jinping is scheduled to iron out the remaining details.
It is worth noting that this is the fourth time President Trump has bypassed federal law regarding TikTok. The law mandating TikTok's sale in the US was based on potential security risks the app poses in its data collection.
The new deadline for the TikTok shutdown is December 16. The exact composition of the new consortium and the terms of the deal are yet to be finalized, but the extension provides a glimmer of hope for TikTok's continued presence in the US.
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