US and China Strike TikTok Deal: A New Era for American Ownership!

The United States and China have reached a 'framework' agreement regarding TikTok's operations in the US, which could allow American companies to take ownership of the app's US division. This development comes as both countries continue to negotiate a broader trade deal. The talks took place in Madrid, and US Treasury Secretary Scott Bessent announced that President Donald Trump and Chinese President Xi Jinping are expected to finalize the agreement soon. Trump commented on social media that the discussions had gone very well, while China confirmed the framework but emphasized that any deal would not harm Chinese companies' interests.

A critical deadline is approaching for TikTok's Chinese parent company, ByteDance, to find a buyer for its US operations. If ByteDance fails to do so by Wednesday, TikTok could be banned in the US due to concerns over national security. The US government fears that American users' data could be accessed by the Chinese government. The deadline for this decision has already been extended, with the latest extension set to expire on September 17. Reports suggest that Oracle is among the companies that could help keep TikTok running in the US if the deal is completed. The BBC has reached out to Oracle, TikTok, the White House, and the Chinese embassy for comments, but none have responded yet.

The question of who owns TikTok has been a major issue in US-China trade negotiations. For China, selling TikTok's US division could help reduce tariffs and trade barriers, making it easier to do business with the US. For the US, the main concern is protecting national security and ensuring that American users' data is safe. The framework agreement is not final, and both countries' leaders must approve it. US trade representative Jamieson Greer said the deal is subject to approval and that the US does not want to keep extending the ban deadline. China's top trade negotiator, Li Chenggang, stated that China would not agree to any deal that goes against its principles.

Earlier this year, the US passed a law that would ban TikTok unless ByteDance sold its US division. TikTok was briefly shut down after the law took effect, but President Trump gave the company more time to resolve the issue. The US Justice Department has warned that TikTok's access to American users' data poses a significant national security threat. ByteDance has repeatedly claimed that its US operations are independent and that no data has been shared with the Chinese government. The company also argued that banning TikTok would violate free speech rights for its 170 million US users.

Several potential buyers for TikTok have been mentioned, including Oracle co-founder Larry Ellison, YouTube creator MrBeast, and billionaire investor Frank McCourt. US and Chinese officials have met four times since May to try to improve relations between the two countries.

Despite the framework agreement, some experts remain concerned about who will control TikTok's powerful recommendation algorithm, which determines what videos users see. There are also questions about whether American users' data will be stored and encrypted in the US and if independent audits will be conducted to prevent unauthorized access by China. Sarah Kreps, director of the Tech Policy Institute at Cornell University, said that until these details are clarified, the deal might only solve the ownership issue on paper while leaving other vulnerabilities unresolved.

Jim Secreto, a former national security official, noted that China has control over whether TikTok's algorithm can be transferred to a new owner. This is likely why the TikTok deal is part of broader trade and tariff negotiations. If national security concerns are addressed, the deal could be a major breakthrough. Secreto added that ByteDance is now one of the largest AI companies in China, and the data TikTok collects from Americans could help train models that support China's military and intelligence capabilities.

As millions of Americans continue to use TikTok daily, the outcome of these negotiations will determine whether the app remains available in the US and how user data is protected.