20th December 2025 – (Hong Kong) Washington may soon declare victory in its long campaign to corral TikTok. A binding agreement, widely reported this week, would place the platform’s U.S. business into a new joint venture—complete with American investors, American auditors and an American “trusted security partner”. The deal is expected to close on 22nd January, just ahead of the deadline created by a US law that would otherwise have forced the app out of the country on national‑security grounds unless ByteDance divested.
Yet beneath the corporate choreography sits a harder, less photogenic fact i.e. the beating heart of TikTok—the recommendation algorithm—would remain owned by Beijing‑based ByteDance, according to reporting that cites an internal memo and sources familiar with the arrangement. If that is true, then the central question is not whether TikTok can keep operating in the United States. It almost certainly can. The more uncomfortable question is whether the version of TikTok that survives will, in practice, be more congenial to Beijing than the political class in Washington is prepared to admit.
To understand why, it helps to separate three things that are being bundled together in the public debate – ownership, operations and control. A joint venture can alter ownership percentages and move operational responsibilities onto American soil. It can even add layers of compliance—audits, assurances, security partners, software checks. But control, especially over what users see and how narratives travel, is often exercised upstream, in the logic of the feed.
That is what makes the reported structure so consequential. The new venture—said to be called TikTok USDS Joint Venture LLC—would be majority‑owned by American investors. Media reports describe three managing investors: Oracle, Silver Lake and Abu Dhabi–based MGX. Under the reported terms, each would hold 15% (45% combined). Roughly 30% would sit with affiliates of current ByteDance investors; ByteDance itself would retain about 20%, with the remainder allocated to other new investors.
These are not minor names. Oracle is chaired by Larry Ellison, an ally of President Donald Trump and one of the world’s wealthiest individuals. Silver Lake is a veteran power broker in American technology. MGX brings sovereign‑wealth heft from the Gulf. Their presence is meant to provide political reassurance: TikTok, the story goes, is no longer a Chinese‑controlled app harvesting American data, but a U.S.‑run platform watched over by U.S. adults.
The memo described by Reuters and other outlets promises exactly that kind of reassurance. The joint venture would have authority over U.S. data protection, algorithm security, content moderation and software assurance. Users, it adds, might see a retraining of the recommendation system “to ensure the content feed is free from outside manipulation.” Oracle would serve as the “trusted security partner”, tasked with auditing and validating compliance with national‑security terms.
All of this sounds like Washington finally getting what it demanded in 2020, when Mr Trump first sought to force a sale, and again in 2024, when Congress passed legislation—later upheld by the Supreme Court—designed to compel divestment or ban the platform. The legal logic was straightforward: TikTok’s data collection practices and its ties to China raised risks that could not be mitigated by promises alone.
But mitigation is exactly what the new deal appears to offer: a complicated apparatus of supervision around a core that stays put. The most revealing line in the reporting is the simplest: the underlying algorithm would still be owned by ByteDance.
That ownership matters for two reasons.
First, TikTok’s algorithm is not a decorative add‑on; it is the product. It decides what goes viral, what is buried, what seems “authentic” and what is treated as spam. It does not need to shout propaganda to shape perception. It can nudge, dampen, accelerate and divert. In an era of politics conducted through attention, recommendation is power.
Second, algorithmic control is difficult to audit in the way politicians imagine. A compliance team can check where data is stored, who has administrative access, whether servers sit in Texas, and whether logs are maintained. It can validate paperwork. It can examine security protocols. What it cannot easily do—at least not with the confidence implied in press statements—is prove the absence of subtle influence in a learning system that changes with data, is updated in software releases, and can be tuned through opaque parameters.
None of this requires a conspiratorial claim that a feed is being steered minute by minute from Beijing. The point is structural – if ByteDance owns the core recommendation technology, it retains leverage over the most sensitive part of the platform’s functioning, even if the U.S. entity manages day‑to‑day moderation and assures regulators of compliance.
This is why some former U.S. officials have derided the reported arrangement as closer to a franchise than a true sale. A franchisee can run the shop; the franchisor still owns the recipe.
It also explains why Beijing’s stance, as reiterated by China’s foreign ministry, matters. Chinese officials have said their position remains “clear and consistent,” emphasising that any solution should comply with China’s laws and regulations and respect the company’s wishes. That is diplomatic language, but the subtext is obvious: China expects a say in any transfer of sensitive technology. If the algorithm stays with ByteDance, that is not merely a business decision—it is a political compromise that keeps the crown jewels within Chinese jurisdiction.
And so Washington’s effort to “solve” TikTok may be drifting into a paradox. U.S. politicians pushed for divestment precisely because they feared a Chinese company’s ability to influence and extract value in the American information space. Now they may accept a structure in which American capital and American oversight wrap around a Chinese‑owned core. The platform remains, in the only way that counts to users, recognisably TikTok—because the system that makes TikTok addictive and culturally dominant is still ByteDance’s.
Some analysts quoted by the BBC suggest the U.S. version could become “safer and sturdier” yet less culturally electric—more moderated, more cautious, more compliant. That may be true. Investor influence, advertiser pressure and regulatory scrutiny tend to make platforms more risk‑averse. But it does not follow that a more heavily supervised TikTok will be more neutral. It may simply be more managed.
American investors will push for stability and revenue. U.S. regulators will push for security assurances. Meanwhile, a Chinese parent retaining algorithm ownership has every incentive to protect its technology, maintain its global advantage and ensure the product remains aligned with its strategic environment—including what is acceptable to Beijing and what is not.
The likely outcome is not a cartoonish propaganda machine; it is something subtler and therefore more effective: a platform that becomes easier for Washington to tolerate and easier for Beijing to live with. “Free from outside manipulation” is a memorable phrase, but it invites the obvious question: outside of what, exactly? If the core system remains ByteDance’s property, then the line between “inside” and “outside” begins to look like a matter of corporate drafting rather than genuine independence.
There is a further irony. One of the political accelerants behind the 2024 ban push, as reported, was lawmakers’ perception that TikTok carried an unusually large volume of pro‑Palestinian content. That concern may or may not have been well founded. But it revealed how quickly Washington’s security argument bleeds into a speech argument: suspicion that the platform does not merely collect data, but shapes discourse in ways that unsettle the establishment.
Under the new deal, TikTok may become less of a headache for Washington’s domestic politics—if retraining and tighter moderation produce a tidier feed. Yet the deeper security question—who ultimately owns and can shape the recommendation engine—would remain unresolved. And that is precisely where Beijing’s interests are most concentrated.
If the reported terms are accurate, the deal will be sold as a triumph of American oversight. It may also be remembered as the moment Washington accepted that it could not truly prise the algorithm away—and chose, instead, to put an American lock on a Chinese door while leaving the key in Beijing.
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