The American version of TikTok is one step closer to reality after a group of investors finalized a deal with parent company ByteDance to acquire the mega-popular short video app, but TikTok's future in the U.S. — and what it means for users — is far from settled.
According to the New York Times, the software giant Oracle, the investment company Silver Lake, and an Emirati investment firm called MGX will each control 15 percent of the new U.S. spinoff. New investors are expected to hold 50 percent of the new entity, but the fate of the remaining 5 percent remains unclear. While ByteDance can remain as an investor, it can hold no more than 20 percent under a 2024 federal law that limits Chinese ownershipin the app.
According to the BBC, TikTok owes much of its success to a ferociously effective algorithm that analyzes vast amounts of data from around the globe and feedback loops that constantly update recommendations to individual users. Under the terms of the sale, ByteDance will license the algorithm to Oracle, which will re-train the algorithm on American user data. In an interview with the BBC, social media expert Matt Navarra warns that the narrower data stream might alter the strange and weird and often deeply niche content that made TikTok so appealing in the first place. Other experts anticipate that the U.S. algorithm may be slower to deliver personalized and viral content.
