‘No Plans’ To Sell TikTok, ByteDance Insists

ByteDance, the Chinese internet company, has declared it has no plans to sell TikTok after a new US law imposed a deadline for it to divest from the enormously popular video platform or have it banned in the US.

US lawmakers imposed the nine-month deadline on national security grounds, claiming that TikTok can be used by the Chinese government for espionage and propaganda as long as it is owned by ByteDance.

The Information, a tech-focused US news site, stated that ByteDance was considering selling TikTok without the sophisticated secret algorithm that recommends content to its more than one billion viewers worldwide.

ByteDance denied it was considering a sale.

“Foreign media reports about ByteDance exploring the sale of TikTok are untrue,” the company posted Thursday on Toutiao, a Chinese-language platform it owns.

“ByteDance does not have any plans to sell TikTok.”

TikTok has been a political and diplomatic hot potato for years, beginning with former President Donald Trump’s administration’s unsuccessful attempt to prohibit it.

It has categorically rejected any ties to the Chinese government, stating that it has not and will not share US customer data with China.

TikTok claims to have invested approximately $1.5 billion on “Project Texas,” which involves storing US customer data in the United States.

Critics argue that the data is only part of the issue, and that the TikTok recommendation algorithm — the “secret sauce” to its success — must be separated from ByteDance.

TikTok CEO Shou Zi Chew has stated that the company will take the fight against the new rule to court, although some experts believe that for the US Supreme Court, national security concerns may outweigh free expression protections.

Bullish investors 

TikTok’s estimated price is in the tens of billions of dollars, and any forced sale would cause significant issues.

Among companies with vast pockets, US digital behemoths such as Instagram parent Meta or Google would likely be barred from purchasing the app because to competition concerns.

Furthermore, many investors see TikTok’s recommendation system as its most important feature.

However, any sale of such technology by a Chinese company would require Beijing’s consent, as such algorithms were classed as protected technology following Trump’s effort to ban TikTok in 2020.

Beijing has so far expressed strong opposition to any forced sale of TikTok, stating that it will take all necessary steps to defend Chinese enterprises.

While TikTok has become a global phenomenon, analysts and investors believe it accounts for a minor portion of ByteDance’s revenue.

In recent years, ByteDance has experienced tremendous expansion, emerging as one of the world’s most valuable enterprises. Its overseas investors include US corporations General Atlantic and SIG, as well as Japan’s SoftBank, who have holdings worth billions.

“TikTok US is a very small part of the overall business. It is an exciting part of the story, for sure, but… relative to the overall size, it’s a very small part,” ByteDance investor Mitchell Green, of US-based Lead Edge Capital, told CNBC television last month.

“If it was kicked out of the US, we would not sell.”

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