ByteDance will be better off without TikTok US

There is a lot more to the Chinese tech giant than its American offshoot.

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Once you start using TikTok, good luck taking your eyes off it.

The same goes for the saga of the Chinese app’s American misadventures. Unlike TikTok’s irresistible short videos, this has dragged on for years.

Now, at last, it is nearing a denouement. In late September the contours began emerging of an arrangement reached between US President Donald Trump and his Chinese counterpart Xi Jinping to hand control of TikTok US to a consortium led by American investors. It was either that or, in keeping with a bipartisan law signed in 2024 by Mr Trump’s Democratic predecessor, TikTok would eventually go dark in America.

Though the details remain fuzzy, a 30-second TikTok rundown would go something like this. The new owners (flash faces of Mr Larry Ellison and a few of Mr Trump’s other Silicon Valley chums) got 80 per cent of shares in the American entity. The deal values it at US$14 billion (S$18.1 billion). Huh? Analysts thought it was worth at least US$40 billion and perhaps as much as US$100 billion. Abhh! Turns out that half the profits would still flow to ByteDance, TikTok’s parent company in Beijing, which would retain a 20 per cent interest.

But a licence to use the app’s eye-adhesive recommendation algorithm is now in American hands, ensuring it cannot be manipulated by the Communist Party. Big thumbs up.

TikTok’s American devotees, 17 million of whom scroll through it at least once a month, according to eMarketer, a research firm, can relax. The new shareholders can rub their hands at what looks like a bargain even given their diluted economic stake. And Mr Trump can revel in the glory of closer-in-chief.