Blog

TikTok Service Resumes in the US: Trump’s New Deal Amid Geopolitical Tensions and Corporate Stakes

Emilia Wright | January 20, 2025

Responsive image

TikTok Restores US Service Amid Political Maneuvering

TikTok has resumed its services in the United States, following a supportive declaration from President-elect Donald Trump, who announced his intention to facilitate the app’s return to American users. After facing potential restrictions due to national security concerns, TikTok, which boasts approximately 170 million users in the U.S., initiated the restoration of its services on Sunday, just ahead of Trump’s inauguration.

Trump’s Outreach to Rescue TikTok

“Frankly, we have no choice. We have to save it,” Trump stated, indicating that a joint venture could be the solution to TikTok’s troubles in the U.S. Despite previous threats to ban the app entirely due to its ties with Chinese parent company ByteDance, Trump’s recent shift in tone signifies a nuanced approach. He expressed that he would extend the effective date of a law designed to prohibit the app, allowing time for negotiations that would secure U.S. national security interests.

In a statement to its users, TikTok acknowledged Trump’s efforts, stating: “As a result of President Trump’s efforts, TikTok is back in the U.S.” The service began coming back online for some users, although by late Sunday, the app was still unavailable for download in U.S. app stores. TikTok thanked Trump for delivering crucial clarity to service providers, assuring them that they wouldn’t face penalties for allowing the app’s continued operation.

China’s Response and Regulatory Landscape

The restoration of TikTok’s service arrives amidst a complicated U.S.-China relationship characterized by tariff threats and differing stances on corporate governance. Mao Ning, spokesperson for China’s foreign ministry, underscored the importance of an independent operational environment, stating, “TikTok has operated in the U.S. for many years and is deeply loved by American users.” The ministry emphasized a hope that the U.S. would create an equitable business climate for foreign firms.

TikTok’s Brief Shutdown and Immediate Aftermath

TikTok stopped functioning for U.S. users late on Saturday, coinciding with the enactment of a law that would have rendered the app inoperative. U.S. officials cited concerns around data handling under ByteDance, prompting the need for the app’s cessation. Trump’s new order signifies an about-face, as he previously pursued a full ban on the app, arguing it threatened American data security.

Moreover, with Trump’s statements indicating a preference for achieving a 50% ownership stake in a new joint venture, the potential outcomes for TikTok indicate a blend of negotiation and collaboration. “I would like the United States to have a 50% ownership position in a joint venture,” he articulated on his Truth Social platform, directing attention toward a more combinatory future structure for TikTok.

Political and Corporate Reactions

This latest initiative has been met with mixed reactions, even within Trump’s own Republican Party. Senators Tom Cotton and Pete Ricketts conveyed skepticism about any possible extensions to the law now that it has come into effect. They stipulated that for TikTok to resume operations in the U.S., ByteDance must fulfill legal sale requirements to sever its ties with the Chinese Communist Party.

As the impending alterations surround TikTok’s operational modalities unfold, marketing firms that heavily relied on the platform have already begun crafting contingency plans, facing what one executive referred to as a “hair on fire” moment due to the uncertainty regarding the app’s future.

Potential Buyers and Valuation

As discussions continue, suitors have emerged, with reports of interest from entities including former Los Angeles Dodgers owner Frank McCourt and notable billionaire Elon Musk. Analysts posit that TikTok’s U.S. operations could hold considerable value, potentially reaching up to $50 billion, which places the stakes high in terms of both investment and regulatory compliance.

One startup, Perplexity AI, has even extended a bid to merge its operations with TikTok’s U.S. affairs, indicating an evolving landscape marked by both competitive interest and executive dealings as companies strategize on the future of potentially lucrative social media platforms.

Conclusion

The unfolding saga of TikTok in the U.S. is a testament to the intersection of social media and geopolitics. With 170 million users awaiting clarity, the implications of this situation extend far beyond TikTok, delving into broader themes of data privacy, cross-border commerce, and the future of digital communication. The outcome of this latest maneuvering remains to be seen, as the balance of national security and economic opportunity continues to shape policies affecting American users and international businesses alike.