Hajra Naz
After years of stalled talks, ByteDance seems close to striking a deal that could reshape TikTok’s future in the U.S. The Chinese parent company of TikTok appears set to keep control over key parts of the app, despite a law that said otherwise.
Reports suggest ByteDance will retain influence over advertising, e-commerce, and recommendation systems for TikTok in the U.S. It would also collect about 50% of the new TikTok U.S. revenue through profit-sharing agreements.
This deal comes even after an executive order signed by Donald Trump declared that TikTok’s U.S. arm must have “no operational relationship” with ByteDance.
ByteDance’s Hidden Leverage
Documents show that the Trump plan mirrors earlier proposals made under the Biden administration. In those plans, ByteDance would still hold sway over U.S. TikTok’s budget, assets, and even bankruptcy decisions.
The centerpiece of those talks was Project Texas. Under Project Texas, ByteDance offered to create a new U.S. entity called TikTok U.S. Data Services (USDS). It would be run separately, with data stored in Oracle-managed servers in the U.S.
But the Biden White House rejected the deal. Officials warned that it still left control of TikTok’s algorithm, source code, and software development in China. They also noted that Chinese staff could continue influencing decisions.
Congress later passed a law requiring TikTok to be either sold or banned. It stated that no post-sale TikTok could maintain ties with ByteDance.
Yet critics say the new Trump deal is little more than a rebranded Project Texas. Instead of a full sale, it looks like a partial spinoff packaged as a sale. That framing makes it appear larger than it really is.
Read More: TikTok’s Revenue Surges in Europe While Facing U.S. Ban Threats
The Role of Advertising
The biggest concern is ByteDance’s likely control over TikTok U.S. advertising. Reuters reported that a division still owned by ByteDance will handle e-commerce and ad revenue.
This matters because TikTok ads have already carried Chinese state propaganda. In 2023, Forbes revealed that CCP-linked media ran ads across Europe that reached millions of users. If ByteDance keeps ad control, critics warn it could push CCP messaging to U.S. audiences as well.
What About Government Oversight?
Another unresolved issue is the U.S. government’s role in TikTok U.S. Some reports suggest the government may seek special powers, such as veto rights over hiring, privacy, and content policy.
The Biden plan included proposals like this, but Trump’s deal may differ. The White House insists it will not take a “golden share” or equity stake in TikTok. But it is unclear whether U.S. agencies will still gain unique access to data or policy decisions.
A Battle of Semantics
Experts say the differences between Project Texas and the Trump deal may be mostly in wording. By calling it a “sale,” ByteDance and its allies make the deal appear stronger than it is.
But in practice, ByteDance may still own, profit from, and influence TikTok’s U.S. operations. That would violate the spirit of the law, even if the contract technically satisfies its language.
Critics warn that if ByteDance keeps control, TikTok could remain a national security risk. That risk centers on data access, algorithmic influence, and propaganda through advertising.
Read More: Executive Order Signed by Trump Supports TikTok’s Move to US Ownership
What Happens Next
The final deal terms are not yet public. Congress and regulators will have to decide if the arrangement truly separates TikTok from ByteDance.
For now, ByteDance appears closer than ever to saving its hold over TikTok’s U.S. business. Whether that satisfies lawmakers or sparks more calls for a ban remains to be seen.
FAQs
1. What is Project Texas?
Project Texas was ByteDance’s proposal to create a U.S. entity called TikTok U.S. Data Services. It claimed to separate data from China, with Oracle managing U.S. servers. Critics said ByteDance would still keep too much control.
2. Why is advertising control so important?
Advertising funds TikTok. If ByteDance controls it, it can shape what content and campaigns reach users. Critics fear this could be used for Chinese propaganda.
3. How is Trump’s TikTok deal different from Biden’s?
Not much. Both give ByteDance visibility and influence over U.S. operations. The Trump deal, however, is being branded as a “sale,” which may make it look stronger than it is.
4. Does the U.S. government get any control?
That remains unclear. Some reports suggest possible veto rights over policy, but officials say the government will not take equity in TikTok.
5. Could TikTok still be banned?
Yes. If lawmakers decide the deal does not meet legal requirements, the U.S. could still force a ban. The debate is far from over.
