Trump Halts TikTok Ban, Giving App More Time to Find a Buyer (1)

President Donald Trump temporarily halted a ban on TikTok in the US, granting the company and its Chinese parent ByteDance Ltd. more time to reach a deal for the popular app that would resolve long-standing US national security concerns.

TikTok’s lifeline came via an executive order signed by Trump on Monday in one of his first acts after taking office. The move gives the video-sharing platform a 75-day reprieve from a US prohibition that took effect on Sunday following ByteDance’s refusal to comply with a law requiring it to divest. Trump had spent the past several days promising an extension was on the way.

Trump highlighted TikTok during a lengthy orders-signing ceremony at the White House, reiterating his stance that American companies should own half of the social video phenom. At one point, he said the US arm of the platform — estimated to be worth around $50 billion — could hit $1 trillion in market value under American ownership.

“TikTok is worthless, worthless, if I don’t approve it,” Trump said as he signed the order, suggesting he might be open to a joint venture with TikTok. “I could see making a deal where the U.S. gets 50 percent of TikTok, polices it a little bit, or a lot, depends on them.”

Read More: TikTok, Border, Pardons: Trump’s Executive Order Priorities

President Donald Trump signs executive orders in the Oval Office on Jan. 20.

Photographer: Anna Moneymaker/Getty Images

Whether his order alone is enough to stave off a ban remains unclear. According to the law, an extension is only possible if the president can show Congress that there’s a viable path forward to a deal, that “significant progress” has been made and that legal agreements are in place to close a deal with ByteDance in that new time frame. There’s no public evidence that ByteDance has met those requirements.

Trump’s intervention marked the latest twist in a years-long saga in Washington fueled by concerns that China could use the app to harvest American users’ data and disseminate propaganda — claims the company has strenuously denied. The order highlighted a turnabout for the president, who tried to ban TikTok in his first term but came to embrace it as a conduit to young voters during his comeback bid for the White House.

“I have a warm spot for TikTok that I didn’t have originally,” Trump said. “Republicans typically don’t do too well with young people, but it’s a different Republican Party.”

TikTok and a legion of the platform’s content creators had fought the measure signed last year by President Joe Biden, arguing that it violated their constitutional right to free expression. But their efforts fell short, with the Supreme Court upholding the law in a unanimous decision on Friday, leaving Trump as their last hope to keep the app alive in the US.

Under the law, tech companies that host and distribute TikTok — including Apple Inc., Alphabet Inc.’s Google and Oracle Corp. — would face the prospect of massive fines for continuing to support the app. They now have to decide whether an executive order from the Trump administration provides sufficient legal cover.

Late on Saturday, TikTok made good on its threat to pull the plug on the app for its 170 million U.S. users, citing a lack of clarity about its fate during the last day of the Biden administration and the start of the Trump term. Users were greeted with an in-app message on the site’s home screen saying the service would be “temporarily unavailable,” while app stores operated by Apple and Google removed TikTok.

That was a fate that Trump and some of his advisers, along with a growing number of US lawmakers, had hoped to avoid. Shortly after the Supreme Court issued its decision, Trump said he had spoken with Chinese President Xi Jinping about TikTok and expressed optimism that a solution could be reached.

Read more: TikTok Return Draws Scrutiny of Trump’s Stance

It’s far from certain that a sale will materialize, and ByteDance has previously said that it has no intention of divesting. But Trump, who prides himself on his dealmaking abilities, is hoping he can help facilitate an arrangement now that he’s back in the White House.

Finding a buyer for TikTok would be a challenge, not just because of ByteDance’s reluctance but because of the expected price tag. Few companies or individuals could likely afford the app.

One prospective ownership group led by billionaire real estate investor Frank McCourt and “Shark Tank” personality Kevin O’Leary has been waging a full-court press for its bid. The duo are proposing to buy TikTok without its coveted recommendation algorithm, and O’Leary recently met with Trump at his Mar-a-Lago club to make a personal appeal ahead of the inauguration.

Perplexity AI approached ByteDance with an offer to merge TiKTok’s US unit with its American operations and create a new entity, according to a person with knowledge of the matter. The structure would allow most of ByteDance’s existing investors to retain their stakes, according to CNBC, citing a person familiar.

TikTok CEO Shou Chew, center, attends Trump’s swearing-in ceremony in the rotunda of the US Capitol in Washington, DC, on Monday, Jan. 20.

Photographer: Kevin Lamarque/Reuters/Bloomberg

During Trump’s first term as president, Oracle and Walmart Inc. tried to buy TikTok, but that deal ultimately fell apart after he left office. Amazon.com Inc. is considered a potential acquirer, in part because it is already a TikTok partner for shopping features. Other logical suitors, like Meta Platforms Inc. and Google, are considered longshots given they are mired in antitrust regulation.

Read more: China Weighs Sale of TikTok US to Musk as a Possible Option

Another hurdle would be the Chinese government, which sees tech companies like ByteDance as an extension of its tech ambitions, according to Li Mingjiang, associate professor at Nanyang Technological University.

“Allowing a foreign entity, particularly from the US, to acquire a controlling stake could be perceived as a loss of sovereignty over an influential digital platform,” Li said. “This is particularly sensitive given TikTok’s global reach and potential to shape narratives.”

On Monday, Trump signaled that he might resort to tariffs to prod officials in Beijing into accepting a TikTok deal. “If we wanted to make a deal with TikTok, and it was a good deal, and China wouldn’t approve it, then I think ultimately they’d approve it, because we’d put tariffs on China,” Trump told reporters. “I’m not saying I would, but you certainly could do that.”

Trump’s conversation with Xi days before the inauguration could prove critical in winning over Chinese officials who have previously opposed a sale. Signs of a thaw in Beijing regarding a divestment appeared last week in Beijing, where officials considered billionaire Elon Musk as a potential buyer, Bloomberg News reported.

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Musk, now one of Trump’s closest allies after spending more than $200 million on his campaign, owns the X social media platform and an artificial intelligence company, xAI, that could benefit from TiKTok’s torrent of data.

Ahead of Trump’s inauguration, TikTok escalated its appeals to the incoming president, highlighted by Chief Executive Officer Shou Chew’s visit with Trump last month at Mar-a-Lago. On Sunday, the day the ban took effect, Chew attended a rally for thousands of the president’s supporters in Washington, and he had a prominent seat in the Capitol Rotunda on Monday for Trump’s swearing-in ceremony.

According to the order, Trump and his advisers will review “sensitive intelligence” related to the national security concerns posed by TikTok before deciding on a path that will keep the platform operating in the US.

But key Republican leaders in Congress have made clear that that they still expect ByteDance to sell TikTok despite Trump’s confidence in some type of solution. There must be a “full divestiture” from the Chinese Communist Party, House Speaker Mike Johnson said on NBC’s Meet the Press, while Senate Intelligence Committee chair Tom Cotton said in a post on X there was no legal basis for any kind of extension.

(Updates with more from Oval Office signing starting in third paragraph.)

--With assistance from Josh Xiao and Colum Murphy.

To contact the reporters on this story:
Kurt Wagner in San Francisco at kwagner71@bloomberg.net;
Josh Wingrove in Washington at jwingrove4@bloomberg.net

To contact the editors responsible for this story:
Jillian Ward at jward56@bloomberg.net

Michael Shepard, Edwin Chan

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