Time for a quick check in on the U.S. TikTok sweepstakes, with another player looking to refine its offer to acquire the U.S. operations of the short-form video powerhouse.
Yesterday, Perplexity AI revised its takeover offer for TikTok U.S., with a new proposal that could hold more appeal to the Trump administration.
As reported by CNBC:
“The proposal, which would create a new entity combining Perplexity and TikTok U.S., would now also allow for the U.S. government to own up to 50% of the new company upon a future IPO.”
Which sounds horrible, in giving the U.S. government direct influence over what gets shown (and doesn’t) in the app. But also aligns with President Trump’s statements on the app, and his ambitions for the government to directly benefit from any TikTok deal.
Earlier in the month, as part of his victory tour in the lead-up to Inauguration Day, Trump announced that he planned to organize a joint venture with China to keep TikTok available in the U.S. Trump didn’t offer a lot of detail of his plan, but noted that the U.S. would end up owning 50% of TikTok, with China’s ByteDance presumably retaining its own half of the app.
That, in Trump’s view, would meet the requirements of the Protecting Americans from Foreign Adversary Controlled Applications Act, which was enacted to ensure that U.S. users of the app are protected, and that TikTok is not being utilized by the Chinese government for information gathering or propaganda purposes.
As per Trump:
“So whether you like TikTok or not, we’re gonna make a lot of money.”
Again, the details are not clear, but the suggestion seems to be that Trump would prefer that the U.S. Government gains some level of influence over the app, which would be similar to how TikTok operates within China.
On the Chinese version of the app, called “Douyin”, the Chinese government has a say in what trends, and what users see in the app, which it uses to ensure that youngsters, in particular, are shown more educational, beneficial content. The Chinese government also maintains strong control over all news and informational messaging, which you can also imagine would hold some appeal for a leader like Trump.
Trump has spent the past four years lamenting how the media, including social media, treated him during the past election cycle, which he maintains was stolen from him. At one stage, Trump even threatened to have Meta CEO Mark Zuckerberg jailed for life over what he viewed as political interference, after Trump was banned from Meta’s apps in the wake of the Capitol riots.
With this in mind, having more say over what gets displayed, or not, in a major social platform could align with Trump’s thinking, and could factor into an eventual sale of the app.
Which, as of right now at least, seems to be down to:
- Oracle is reportedly in talks with the Trump Administration about acquiring the U.S. operations of TikTok, though Trump has said that he has not spoken to Oracle CEO, and friend, Larry Ellison about any such acquisition
- Microsoft has been mentioned as a possible U.S. partner for the app, though Microsoft itself hasn’t publicly declared any interest in any such deal (Microsoft was one of the main players in the previous TikTok sell off push)
- The Chinese Government and Trump have both expressed interest in Elon Musk taking over TikTok U.S., though Musk himself has not declared any personal interest in such
- YouTuber MrBeast has reportedly joined a consortium of investors, including Jesse Tinsley, the founder of Recruiter.com, to make an offer for TikTok U.S.
- Another consortium, led by Shark Tank’s Kevin O’Leary and billionaire Frank McCourt, has also submitted an offer for the app
One of these groups, at this stage at least, looks likely to take over the U.S. operations of TikTok, though whether that deal will meet the requirements of the sell-off bill, and whether it will also include TikTok’s almighty algorithm (China has said that it will not sell the algorithm in any deal) remains to be seen.
TikTok and the Trump administration currently have until April to work it out.
