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When President Donald Trump signed an executive order on January 19th delaying the ban on TikTok it gave the ByteDance company 75 days to find a buyer. Essentially, ByteDance has to find a U.S. buyer to divest TikTok’s U.S. operations in order to keep operating in the United States and President Trump indicated he would be able to get that done within a period of 30 days.
It has been less than a month since the TikTok executive order was signed and there’s plenty of time left but a new report from Elizabeth Dwoskin, Naomi Nix and Drew Harwell of the Washington Post indicates that at this point, a sale is unlikely and Beijing would rather allow TikTok’s U.S. operations to die out than to bend the knee.
For those out there thinking ‘Cass, what’s the big deal here? I still have TikTok on my phone and it’s operating like normal’ well… I’m one of those unfortunate few who immediately deleted the app from their phone after the 12-hour ban went into effect. It was late, I was at the bar, and I made the rash decision that I didn’t want the spyware app on my iPhone if I wasn’t at least going to get to scroll my silly little videos so I deleted it only to wake up and learn that it was already back…
If this report is to be believed, the TikTok app will never make it on my phone again. They wrote:
But Beijing is increasingly likely to take a hard-line approach, letting TikTok’s U.S. operations die rather than approving a sale as it holds out for a “grand deal” with the Trump administration that includes larger concessions on trade and tech policy, according to one of the people and analysts.
The report goes on to highlight how the budding trade war between the U.S. and China driven by tariffs isn’t improving the chances that Beijing would approve a sale of TikTok’s U.S. operations. In response to President Trump placing a blanket 10% tariff on all goods imported from China, Beijing responded by launching an investigation into Google and placing restrictions on materials the tech industry needs for manufacturing.
Some see that as signaling that China signaling they are unwilling to make any sort of deal and are firmly willing to target the tech iddustry in the process, TikTok included. The team at WaPo spoke with Rui Ma who is a tech investor and familiar with all the moving parts.
Ma said the strategy of China letting TikTok’s U.S. operations would be viewed favorably by the Chinese public and interpreted as China standing up to President Trump and the United States. They don’t see this as ‘just let us have our silly little videos so we can doom scroll in bed while hungover’ they see this as China vs the USA and don’t want Beijing to bend the knee.
Ma added “It might be a multi-billion dollar company, but it is still a David versus the Goliath that is the US government.”
Of course, for the right place ByteDance and China would be silly not to sell and divest the U.S. TikTok operations to an American company. There has been a line of potential buyers named since Day 1 but we are now 3 weeks into this process and no clear favorite has emerged nor has there been any discussion of actual offers.
The WaPo report states “ByteDance has received a flurry of interest from would-be buyers since last April, when Congress passed the law effectively banning the wildly popular video app unless it divests from its Chinese ownership” but currently there is no deal in the works. As far as anyone knows, there’s no viable offer coming in and the extension was merely to punt the bad press of banning TikTok down the line a month or two after the inauguration so it didn’t overshadow the festivities.
For his part, President Trump has named Elon Musk as a potential buyer as well as Shark Tank‘s Kevin O’Leary who reportedly pitched the President on a $20 billion offer with billionaire Frank McCourt. ByteDance has also said that it might seek out solutions “short of divesture” but didn’t shed light on what those solutions might be.
As pointed out in the report, ByteDance doesn’t need the money from a sale. They are generating an asinine amount of money, to the tune of $7 billion in Q1 of 2023 and in 2024 TikTok’s advertising revenue was $18.49 billion. Losing 170 million American users would be a pain in the side but it would by no means cripple TikTok’s thriving business.