WSJ Says TikTok Divestiture of U.S. Operations Nears Completion, I Say It Will Make Everyone Mad ⇥ wsj.com

Raffaele Huang, Lingling Wei, and Alex Leary, Wall Street Journal:

The arrangement, discussed by U.S. and Chinese negotiators in Madrid this week, would create a new U.S. entity to operate the app, with U.S. investors holding a roughly 80% stake and Chinese shareholders owning the rest, the people said.

It must be at least an 80% stake. That is the letter of the law this administration has been failing to enforce.

This new company would also have an American-dominated board with one member designated by the U.S. government.

A golden share, perhaps?

Existing users in the U.S. would be asked to shift to a new app, which TikTok has built and is testing, people familiar with the matter said. […]

“Asked”?

[…] TikTok engineers will re-create a set of content-recommendation algorithms for the app, using technology licensed from TikTok’s parent ByteDance, the people said. U.S. software giant Oracle, a longtime TikTok partner, would handle user data at its facilities in Texas, they said. […]

And I am sure this will satisfy everyone who has found TikTok’s success alarming. Oracle already has access to TikTok’s source code and — at best — will allow TikTok employees to rewrite it to get a “Made in the USA” stamp. It is possible the recommendations system will be unchanged.

Of course, Chinese investors will still have a stake in the U.S. company and, unless the U.S. company is entirely siloed from TikTok everywhere else, users will still be recommended videos the U.S. government framed as a national security threat. But now the U.S. app will seem suspicious to anyone who has been skeptical of the country’s increasing state involvement in the tech industry.

Some TikTok users are going to be furious about this. Some people who viewed its Chinese ownership as inherently problematic are not going to be satisfied by this. It is going to make everyone a little bit upset. It is unclear if it will solve any of the pressing concerns, either. From a distance and in summary, what it looks like is the U.S. government panicked over the only massively successful social media app not based in the U.S., then wrested control of the app and gave it to people friendlier to this government. That is too simplified but, also, not inaccurate.