By Ettech Last Updated

Copyright indiatimes

President Donald Trump signed an executive order on Thursday backing the planned sale of TikTok’s US operations to a group of American investors. He said the deal will address national security concerns while allowing the popular video-sharing app to stay available to millions of US users.TikTok deal: DetailsAccording to Vice President JD Vance, the new US-based company will be valued at around $14 billion. This is much lower than some analyst estimates, which put the value between $30 billion and $40 billion without the algorithm (as of April 2025).The executive order gives a 120-day deadline, that is, until January 20, for the agreement to be finalised. The US-based company will be fully under American control, including oversight of the algorithm, user data, security measures, and content moderation.Trump also said he had spoken with Chinese President Xi Jinping, and that Xi “gave the go-ahead” for the deal, although China has not officially confirmed this.”There was some resistance on the Chinese side, but the fundamental thing that we wanted to accomplish is that we wanted to keep TikTok operating, but we also wanted to make sure that we protected Americans’ data privacy as required by law,” Vance told reporters at an Oval Office briefing, according to Reuters.TikTok ownershipThe deal will create a new structure for TikTok’s US business. American companies such as Oracle, Silver Lake, and MGX will jointly own around 80% of the new company. ByteDance, TikTok’s Chinese parent, will hold less than 20%.However, several aspects still need to be worked out, especially how the new US company will manage TikTok’s key asset: its recommendation algorithm. Trump’s order states that the algorithm will be retrained and monitored by US security partners, and its operation will be under the control of the new joint venture.With US investors in charge, the platform may change how it manages data, moderates content, and responds to political pressure. These changes could also influence which content is highlighted, how advertisements are run, and how the business is structured.BackgroundIn April 2024, Congress passed the Protecting Americans from Foreign Adversary Controlled Applications Act (PAFACA), which bans apps controlled by countries the US considers adversaries unless they undergo a “qualified divestiture”. The law was introduced due to national security concerns.In his executive order, Trump stated that the new agreement solves these issues because “it removes the TikTok application and certain other applications from the ‘control’ of a foreign adversary and precludes any ‘operational relationship’ between a formerly affiliated entity controlled by a foreign adversary and the new joint venture”.If the restructuring hadn’t gone ahead, TikTok could have faced a ban in the US, affecting over 170 million users. “More than simply providing entertainment, many American content creators rely on the TikTok application for their livelihood and many American businesses rely on it for their advertising,” the executive order said.Analysts say the move shows a strategic decision: avoid a full-blown trade and tech conflict, while still letting China keep a small stake. But many agree that China appears to have made the bigger compromise. More clarity is expected once China responds publicly and comments on the deal.