TikTok’s new ownership structure doesn’t solve security concerns for Americans

TikTok has entered a new era in the United States, but it’s hardly a less risky one.

Last week, the company disclosed the contours of a deal intended to allow the platform to continue operating in the United States, bringing it into compliance with a 2024 U.S. law. The arrangement appears largely consistent with the framework reportedly negotiated between U.S. and Chinese officials last fall. Under the proposed structure, a newly created entity called TikTok USDS Joint Venture would assume responsibility for data security and content moderation, with U.S. investors—including the software company Oracle—holding majority control while ByteDance remains the largest single shareholder at 19.9 percent. TikTok’s existing U.S.-based companies would retain control over the platform’s commercial operations, including advertising, e-commerce and marketing. While the ownership of TikTok’s recommendation algorithm is not explicitly addressed in the latest announcement, a December memo from TikTok CEO Shou Zi Chew indicated that ByteDance would keep ownership of the algorithm’s intellectual property and license it to the joint venture for a fee.

The deal has been framed by some officials and commentators as a meaningful step toward addressing long-standing U.S. concerns about People’s Republic of China (PRC) information manipulation, foreign influence and data security. In practice, it does little to alter the underlying risks that animated the debate during the previous U.S. administration.

Read more at Atlantic Council