Friday seemed to be the last days of TikTok in US download stores numbered. Things turned out differently with an agreement from President Trump. The parties now have a week to finalize everything. But if they fail, TikTok could still get a download ban.
Trump’s approval also raised another big question mark. As part of the deal, TikTok’s parent company ByteDance, Oracle and Walmart have jointly pledged $ 5 billion for an education fund. The president says he has discussed this with the top of the three companies involved.
Trump said at a campaign rally this weekend that the goal of the education fund is to “educate Americans about the real history of our country.” According to Bloomberg news agency, the president wants to counterbalance a school project by The New York Times about the slavery past of the US.
Sources tell the Financial Times the companies do not intend to set up such an education fund. The British business newspaper concludes that Trump’s move could still cause unrest, as there is no official US agreement yet.
Fuss about ownership
What further causes confusion nowadays is the question of who is ultimately in charge at TikTok. A source told The Wall Street Journal yesterday that the shares would be divided in such a way that 53 percent of ‘TikTok Global’ would be in the hands of American parties. After an IPO, this would subsequently rise further. Oracle also spoke this weekend about an “independent American company”.
This was against the sore leg of Chinese parent company ByteDance, which said in a statement that it still has control over the new company. Trump has now also entered the discussion. In a telephone interview with morning program Fox & Friends he said that China will have nothing to do with the new company, “if it does, the deal will not go through”.
Oracle’s proposal has been on the table since last Monday. This was not what Trump had in mind, who would have preferred the app to be sold. Microsoft seemed to be the main contender for a long time. New export regulations from China threw a spanner in the works, making a collaboration with Oracle the best option.
According to the Financial Times, the president still had doubts last Friday whether he would agree to the proposal. A lack of response led to the Department of Commerce announcing that day that TikTok would be banned from downloading, further increasing uncertainty. A day later a green light from Trump followed. “I gave the deal my blessing. If they succeed, it’s okay, if they fail it’s fine too,” he told reporters.
What does China think?
How Beijing looks at the current proposal is as yet unclear. The Chinese Ministry of Foreign Affairs did not want to say much about it in the daily press conference. Spokesman Wang Wenbin did add that China urges Americans to respect “the principles of the market economy and fair competition.”
According to Hu Xijin, editor-in-chief of the Global Times party spokesman, there is little enthusiasm in the Chinese capital. Beijing will not approve the current deal between ByteDance, Oracle and Walmart, he tweets. “The agreement threatens China’s state security, interests and dignity.”