TikTok, the hugely popular video-sharing platform, faces a potential ban on January 19 due to a federal law that could force it to sever ties with its China-based parent company, ByteDance, or cease its operations in the U.S, reports AP.
Several parties have shown interest in acquiring TikTok, but ByteDance has consistently stated it has no intention of selling. Experts have also highlighted that the Chinese government is unlikely to approve a sale that includes TikTok’s prized algorithm.
However, until the deadline passes or the Supreme Court intervenes, the possibility of a sale remains open. Here’s a breakdown:
What is TikTok’s valuation?
According to Wedbush analyst Dan Ives, TikTok’s value is “well over $100 billion” with its algorithm, and in an ideal scenario, it could be worth up to $200 billion. Without the algorithm, Ives estimates its value to be between $40 billion and $50 billion, adding that he doesn’t believe ByteDance or Beijing would agree to sell TikTok without its algorithm.
Lawyers for TikTok and ByteDance have argued that it’s not possible to divest the platform in both commercial and technological terms. They also contend that selling TikTok without its algorithm would effectively isolate the U.S. version of the app, severing it from the global content ecosystem.
U.S. officials have raised concerns that the Chinese government could manipulate the platform’s proprietary algorithm, using it to influence content in ways that would be difficult to detect.
Who is seriously interested in buying TikTok?
Billionaire real estate mogul Frank McCourt and his internet advocacy group have recently proposed purchasing TikTok from ByteDance. Shark Tank investor Kevin O’Leary has also joined the bid, though details about the proposal remain undisclosed.
McCourt, the former owner of the Los Angeles Dodgers, has said that he would aim to restructure TikTok and allow users more control over their digital identities and data. He envisions moving the platform to an open-source protocol to ensure greater transparency.
Former Treasury Secretary Steven Mnuchin has also taken steps to acquire TikTok, stating shortly after the ban was passed that he was assembling an investor group for the purchase. He provided no specifics about the group's composition or TikTok’s valuation.
In addition, figures like Tesla CEO Elon Musk, MrBeast (Jimmy Donaldson), and former Blizzard-Activision CEO Bobby Kotick have been mentioned as potential buyers. However, it’s unclear whether they are seriously pursuing a deal.
Could Trump Intervene? President-elect Donald Trump, who will take office on January 20, has asked the court to pause the law in order to negotiate a “political resolution” during his second term.
If the Supreme Court grants this request, the potential ban on TikTok would be delayed. The Court is expected to make a decision soon.
The Trump transition team has not provided specific details about how he plans to act on his campaign promise to "save TikTok." However, spokeswoman Karoline Leavitt stated in November that Trump intends to fulfill that commitment.
Once Trump is in office, the Justice Department will be responsible for enforcing the law and penalising any potential violators. On Wednesday, Trump’s nominee for Attorney General, Pam Bondi, declined to answer a question on whether she would uphold a TikTok ban during her Senate hearing.