WASHINGTON, Jan 23, 2026, 08:16 EST
- ByteDance said TikTok’s U.S. operations will run through a new majority American-owned joint venture to head off a ban
- Oracle, Silver Lake and Abu Dhabi-based MGX will each hold 15%; ByteDance keeps a 19.9% stake
- The venture will store U.S. user data in Oracle’s U.S. cloud and take charge of securing TikTok’s algorithm
ByteDance said it has finalized a deal to create a new, majority American-owned joint venture to secure TikTok’s U.S. user data and keep the short-video app operating in the United States. Reuters
The move matters because TikTok had been staring at the blunt edge of U.S. law: sell enough of its U.S. business to break Chinese control, or face a nationwide ban. The platform says it reaches more than 200 million Americans and is used by millions of U.S. businesses for marketing and commerce.
For Washington, it is also a live test of how far the U.S. can push “data security” rules onto a consumer app without forcing an outright shutdown. The outcome will be watched closely by advertisers, creators and rivals that have spent years building TikTok-like video feeds.
Under the new structure, American and global investors will hold 80.1% of the venture, with ByteDance retaining 19.9%, the company said. Oracle, private equity firm Silver Lake and Abu Dhabi-based investment firm MGX are the three “managing investors” and will each own 15%.
TikTok said Adam Presser, a former senior executive in its U.S. data security operations, will serve as chief executive officer of the new entity, with Will Farrell named chief security officer. TikTok’s CEO Shou Chew will sit on the venture’s board.
In its announcement, TikTok USDS Joint Venture LLC said its “mandate is to secure U.S. user data, apps and the algorithm” through a data privacy and cybersecurity program hosted in Oracle’s secure U.S. cloud and audited by third-party cybersecurity experts. Tiktok
The joint venture’s safeguards will also cover ByteDance-owned apps including CapCut and Lemon8, according to the company’s release and reporting on the terms. The venture said its controls will align with major security standards such as NIST (U.S. government cybersecurity guidance) and ISO 27001 (an international information security standard), and it will take decision-making authority for trust and safety policies and content moderation in the U.S. Theverge
A White House official told Reuters both the U.S. and Chinese governments signed off on the deal, while the Chinese embassy in Washington did not immediately comment. President Donald Trump hailed the arrangement in a social media post, saying TikTok “will now be owned” by American investors, and he thanked China’s President Xi Jinping for approving it.
The agreement closes out a bruising, years-long fight that began in 2020 when Trump, in his first term, tried to ban TikTok over national security concerns. A law passed in April 2024 required ByteDance to divest its U.S. assets or see the app banned, a measure the Supreme Court upheld.
Still, the structure leaves open questions that could come back fast. The new venture and ByteDance have not disclosed key commercial terms, and regulators will be watching how the U.S. entity insulates the recommendation system — the software that decides what videos users see — from any foreign influence. “Who controls TikTok in the U.S. has a lot of sway over what Americans see on the app,” said Anupam Chander, a professor of law and technology at Georgetown University. Apnews
There is also a market risk: retraining the recommendation engine on U.S. data could change what users see and how well ads convert, pushing creators and brands to test alternatives such as Meta’s Instagram Reels and Alphabet’s YouTube Shorts. TikTok said it will preserve a “global” experience through interoperability, while keeping some commercial activities such as e-commerce and advertising under separate U.S. entities tied to TikTok’s global business.
ByteDance has disclosed few details about valuation and deal economics. Reuters has reported the U.S. venture is designed to handle sensitive backend operations like U.S. user data and the algorithm, while a ByteDance-owned division continues revenue-generating work, and the new venture receives a share of revenue for its technology and data services.
