**Agreement Reached for TikTok Spin-Off to American Investors**
Recent declarations from officials in both the U.S. and China signify that a major agreement has been established concerning the widely-used short-video application TikTok. This progression represents a substantial shift in the ongoing negotiations over the app’s control, which has been a debated topic amid escalating geopolitical tensions.
The deal, as reported by diverse sources including Reuters, is said to encompass a framework that would transfer TikTok to U.S.-controlled ownership. This structure is anticipated to be affirmed in a scheduled conversation between U.S. President Donald Trump and Chinese President Xi Jinping. Notably, this marks the first instance where Chinese officials have recognized such an agreement, though in a more cautious manner than prior assertions from the Trump administration.
China’s cyber security regulator, Wang Jingtao, verified that the two nations have arrived at a “basic framework consensus.” This agreement is expected to postpone the earlier established deadline of September 17, granting additional time for the deal’s completion, which will also necessitate Congressional endorsement.
A crucial aspect of this agreement is the licensing of TikTok’s algorithm, which is integral to the app’s performance. In contrast to many other social media platforms where users choose content, TikTok employs an algorithm that generates an infinite scrolling feed based on individual user preferences. Securing TikTok without access to this algorithm would considerably reduce its value.
U.S. Treasury Secretary Scott Bessent suggested that while the spun-off app would be overseen by American investors, it would still maintain some “Chinese characteristics.” This indicates a hybrid strategy that may seek to reconcile the interests of both countries.
In preparation for this arrangement, TikTok has reportedly been working on a standalone app designed for the U.S. market. The company is eager to guarantee that content produced by American users remains accessible to users on the global version of the app, encouraging continuity across platforms.
However, the details concerning the ownership structure of the U.S. app are still ambiguous. Prior efforts to finalize a deal in March involved multiple U.S. companies holding varying equity percentages, but those discussions ultimately did not lead to a resolution.
As negotiations persist, the outcome of this agreement could bear significant consequences for the future of TikTok and its operations in the United States, as well as for the wider U.S.-China relationship in the technology arena.
