TikTok Completes U.S. Spinoff to Keep App Online
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Chinese parent ByteDance says the popular short-video app will operate in the U.S. under comprehensive data privacy and cybersecurity measures.
TikTok and its parent ByteDance Ltd. have closed a joint-venture deal to address U.S. national security concerns and secure the popular short-video app’s continued operation in the country.
“Today, TikTok USDS Joint Venture LLC has been established,” TikTok CEO Shou Zi Chew said in an internal memo on Thursday U.S. time, one day before a deadline set by President Donald Trump to enforce a law that would have banned the app unless it was spun off from its Chinese parent.
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- TikTok and ByteDance established a U.S. joint venture, TikTok USDS Joint Venture LLC, to address national security and comply with a law demanding TikTok’s U.S. divestiture.
- The new entity is 45% owned by Silver Lake, Oracle, and MGX (15% each); ByteDance shareholders own 30.1%; ByteDance itself holds 19.9%.
- The venture will secure U.S. user data and the algorithm in Oracle’s cloud and is overseen by a majority-American board.
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Who’s Who
- TikTok
- TikTok, a popular short-video app, recently established a joint venture to address U.S. national security concerns. This move, which involved the creation of TikTok USDS Joint Venture LLC, was necessary to continue operations in the U.S. after President Donald Trump's administration pushed for a spin-off from its parent company, ByteDance Ltd. The new entity will be independently overseen and aims to protect U.S. user data and national security.
- ByteDance Ltd.
- ByteDance Ltd. is the Chinese parent company of TikTok. To address U.S. national security concerns, it recently closed a joint-venture deal forming TikTok USDS Joint Venture LLC. This deal reduced ByteDance's direct ownership in the new venture to 19.9%, with existing ByteDance shareholders collectively owning 30.1%. TikTok's other U.S. entities, responsible for global product interoperability and commercial activities like e-commerce and advertising, remain wholly owned by ByteDance.
- TikTok USDS Joint Venture LLC
- TikTok USDS Joint Venture LLC was established to address U.S. national security concerns, allowing TikTok to continue operating in the US. It's an independent entity with a majority American board, and its managing investors include Silver Lake, Oracle, and MGX. This venture was formed to comply with President Trump's executive order, safeguarding U.S. user data and content moderation.
- Silver Lake
- Silver Lake is a private equity firm. Its co-CEO, Egon Durban, is a board member of the newly established TikTok USDS Joint Venture LLC. Silver Lake is also one of the managing investors in the joint venture, holding a 15% stake.
- Oracle Corp.
- Oracle Corp. is a cloud computing giant whose executive vice president, Kenneth Glueck, is a board member of the newly established TikTok USDS Joint Venture. Oracle is also one of the managing investors, holding a 15% stake in the joint venture. Its U.S. cloud environment will secure the content recommendation algorithm for TikTok's U.S. users.
- MGX
- MGX is an Abu Dhabi sovereign wealth fund-backed entity. It has become a managing investor in the newly established TikTok USDS Joint Venture LLC, holding a 15% stake alongside Silver Lake and Oracle. David Scott, chief strategy and safety officer at MGX, is also a board member of this new venture.
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What Happened When
- 2024：
- The U.S. Congress passed legislation requiring TikTok to be sold or banned in the United States.
- January 2025：
- Donald Trump returned to office as President of the United States.
- September 25, 2025：
- President Trump issued an executive order extending the TikTok sale or ban deadline to January 23, 2026.
- By January 22, 2026：
- TikTok and ByteDance closed a joint-venture deal and established TikTok USDS Joint Venture LLC.
- January 22, 2026：
- TikTok CEO Shou Zi Chew announced the joint venture's establishment in an internal memo.
- January 22, 2026：
- Donald Trump praised the TikTok deal on his Truth Social platform.
- January 23, 2026：
- Deadline set by President Trump for TikTok to be spun off or banned in the U.S.
- January 23, 2026：
- Chinese Foreign Ministry spokesperson Guo Jiakun commented on the deal at a regular press briefing.
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