After a long fight against the United States government, ByteDance can now finally take a breather as TikTok has been allowed to continue its operations in the US. This is thanks to a new set of arrangements that been principally agreed by the US President, Donald Trump.
Back in August, President Trump had signed an executive order to ban any American companies from doing business with TikTok and ByteDance due to national security, foreign policy and economy reasons. He then signed another executive order which pretty much led to this deal.
Under the new deal which was announced over the weekend, a company called TikTok Global will be established to serve TikTok users in the US as well as the majority of other users throughout the world. In general, TikTok Global is a US-based company and is expected to provide more than 25,000 new jobs as well as USD 5 billion in tax money for the country.
The deal will also see Oracle as TikTok’s new secure cloud provider in which all of the data for US users will be transferred to Oracle’s cloud data centre. At the same time, 12.5% of TikTok Global will be owned by Oracle while Walmart who will be injecting its commercial expertise into the deal, is taking a 7.5% stake in the newly-formed company.
The deal will also involve the creation of educational initiatives between the three companies as well as some of ByteDance’s investors including Coatue, General Atlantic, Sequoia, and SIG. AI-driven online video curriculum will apparently be the focus of this initiative.
In general, TikTok is now out of the danger zone and likely to be around for quite some time. That being said, it comes at a compromise for ByteDance though, who may have to slowly ease its grip on the platform.