Trump Signs Executive Order to Restructure TikTok Amid National Security Concerns
Washington, D.C. – In a significant move that could reshape the landscape of social media in the United States, President Trump signed an executive order on Thursday aimed at facilitating a deal that would allow TikTok to continue operating in the country under a new corporate structure. This decision comes in the wake of ongoing national security concerns regarding the app’s Chinese ownership.
The Executive Order and Its Implications
The executive order, described by White House staff secretary Will Scharf as a measure to “save TikTok,” establishes a framework for a “qualified divestiture.” This term refers to a legal arrangement that allows TikTok’s parent company, ByteDance, to maintain a minority stake in the app while ensuring compliance with U.S. laws that mandate foreign ownership limits. The order also extends the enforcement of a bipartisan law requiring ByteDance to divest its interests in TikTok by an additional 120 days, pushing the deadline to January 23, 2026.
During a press briefing, President Trump stated that Chinese President Xi Jinping had approved the deal during a recent phone call, indicating a level of diplomatic engagement that could ease tensions between the two nations. “He gave us the go-ahead,” Trump remarked, highlighting the international dimensions of this corporate restructuring.
The Structure of the New Entity
Under the proposed arrangement, ByteDance will be required to relinquish control over TikTok’s content recommendation algorithm, which is crucial for the app’s functionality. Instead, this algorithm will be replicated and retrained to operate solely on data from U.S. users. Oracle, a prominent cloud-computing firm, will play a pivotal role in this transition by hosting American user data and conducting thorough reviews of the app’s code to ensure its security.
The new TikTok entity will be structured as a joint venture based in the United States, with a majority of American investors and a board predominantly composed of U.S. citizens. According to the White House, ByteDance and its affiliates will hold less than 20% of the new company, thereby adhering to the foreign ownership limits set by the divest-or-ban law.
Financial Aspects and Investor Involvement
Vice President JD Vance announced that the new TikTok venture is expected to be valued at approximately $14 billion. A consortium of American investors, including Oracle, will have a stake in this restructured entity. However, the full list of investors and their respective stakes remains undisclosed, with plans for an announcement in the coming days.
The administration has expressed confidence that this proposal will meet legal requirements, with a senior White House official stating, “We feel 100% confident that this proposal, if it’s completed, complies with the law.” This assertion comes amid ongoing scrutiny from lawmakers who have raised concerns about the potential risks associated with TikTok’s Chinese ownership.
Legislative Background and National Security Concerns
The legal framework governing this deal stems from a law upheld by the Supreme Court, which took effect just before Trump’s inauguration in January. This law mandates that foreign adversaries, defined as companies headquartered in nations deemed hostile to U.S. interests, cannot maintain significant control over applications that collect vast amounts of American user data.
Despite the administration’s optimism, some lawmakers remain skeptical. Republican Rep. John Moolenaar, chairman of the House China Committee, expressed concerns that the deal may not sufficiently sever ties between TikTok and ByteDance, particularly regarding the app’s recommendation algorithm. “I am concerned the reported licensing deal may involve ongoing reliance by the new TikTok on a ByteDance algorithm,” Moolenaar stated, emphasizing the need for clear legal safeguards.
The Complexity of Algorithmic Transition
Experts have raised questions about the feasibility of retraining TikTok’s algorithm to function independently of ByteDance. Christopher Krebs, former director of the U.S. Cybersecurity and Infrastructure Security Agency, noted that operational details remain unclear, particularly regarding user experience. The complexity of adapting an algorithm that has been optimized over years to understand user preferences poses significant challenges.
Ari Lightman, a professor of digital media and marketing at Carnegie Mellon University, highlighted the intricacies involved in this transition. “The level of complexity in retraining an algorithm to run off a smaller set of users while maintaining the quality of the current user experience is huge,” he explained. The potential disconnect between U.S. and global content could also impact user engagement, as TikTok’s algorithm relies on a vast pool of data to deliver personalized content.
Future Engagement with Lawmakers
The administration plans to engage proactively with lawmakers to demonstrate the benefits of the new arrangement for American users. White House press secretary Karoline Leavitt emphasized that the deal aims to protect user data while allowing millions of Americans to continue using TikTok. However, the success of this initiative will depend on the administration’s ability to address the concerns raised by lawmakers and experts alike.
Conclusion
President Trump’s executive order marks a pivotal moment in the ongoing saga of TikTok’s operations in the United States. As the administration navigates the complexities of national security, corporate restructuring, and international diplomacy, the future of TikTok remains uncertain. The proposed deal aims to balance the interests of American users with the imperative of safeguarding national security, but its success will ultimately hinge on the execution of the plan and the response from lawmakers and the public. As the situation unfolds, the implications for social media governance and U.S.-China relations will be closely monitored.
