US Government Abandons Plans to Force the Sell-Off of TikTok

As expected, the Biden Administration has now officially announced that it will not be pushing TikTok to sell its company into US ownership, abandoning a push from the Trump team that had approved the sale of TikTok to an Oracle/Walmart lead group

As per The Wall Street Journal:

A U.S. plan to force the sale of TikTok’s American operations to a group including Oracle and Walmart has been shelved indefinitely, people familiar with the situation said, as President Biden undertakes a broad review of his predecessor’s efforts to address potential security risks from Chinese tech companies.”

Former US President Donald Trump issued an executive order last August which outlined separate bans on the operations of Chinese-owned social apps TikTok and WeChat within the US. The orders were each to take effect within 45 days of issue, which gave the two apps until September 20th to make alternative arrangements, or face blockages in the US.

The action was linked to concerns that data on US citizens could be transferred through these apps to the Chinese Government, with China’s cybersecurity laws ruling that all user data provided to Chinese-owned companies be submitted to the CCP on request. Both TikTok and WeChat challenged the EO in court, and both won, several times, which pushed the ban deadline back further and further, till TikTok was finally able to establish the framework of a deal with the Oracle/Walmart consortium, in order to satisfy the US Government’s requests.

The details of that deal have been in negotiation ever since – but now, they’ll likely be abandoned entirely, with TikTok left to expand its US operations, and capitalize on its rising popularity in the region. 

TikTok’s Chinese roots have lead to serval similar concerns, with the app also banned in India last June due to ongoing border conflicts between Indian and Chinese forces. Military personnel in several nations are also banned from using TikTok due to national security concerns, but the fundamental legal grounds for the proposed US Government ban lacked clear evidence to suggest that TikTok may be a risk to US citizens, and their private information. 

But TikTok is not entirely out of the woods just yet. As per to US National Security Council spokeswoman Emily Horne:

“We plan to develop a comprehensive approach to securing U.S. data that addresses the full range of threats we face. This includes the risk posed by Chinese apps and other software that operate in the U.S. In the coming months, we expect to review specific cases in light of a comprehensive understanding of the risks we face.”

That doesn’t necessarily mean that TikTok will face the same level of specific scrutiny once again. But that review could find that TikTok still poses a significant risk, which has been noted by several cybersecurity analysts in the past. 

If the incoming US Government does believe that TikTok is a problem, it may still face restrictions, or be pressured to make changes to its app. That seems unlikely to result in a similar forced sell-off, where the US Government takes a cut of the sale price (which still seems like an astounding request). But it will be something for TikTok to watch, and may still have an impact.

So, after all that, after all the back and forth and debate, after all the negotiations between companies, the legal challenges, the reviews, etc. After everything that’s happened, the great TikTok sell-off fiasco fades out with a whimper. 

It’s amazing to think about the time and resources that went into this, the money spent on a process that ultimately lead to nothing at all. But that’s the way it goes – TikTok will just be happy to be able to continue on, and move forward with its evolution, as it looks set to become the next billion-user social platform

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