It’s encouraging TikTok plans to put its algorithm on a leash. They’re going to need to use data from their 170 million American users if they want to protect the app’s future in the still-graphics-heavy country. The bill follows months of bipartisan discussions on national security. It expands on Project Texas, which previously made sure that all TikTok user data is kept on Oracle servers.
President Donald Trump made the announcement that a final deal was reached. As long as ByteDance, TikTok’s parent company, sells the app, this agreement will stop the ban on TikTok. This important step shines further light on the growing concern over data privacy and security dangers posed by foreign-owned apps. The deal, if approved, would lay out how and where TikTok will specifically meet US national security concerns. Most notably, these requirements have sparked an outcry since the app first gained massive popularity.
Additionally, TikTok’s algorithm—which determines what content users see in their feeds—will be reworked from the ground up. The app will have to completely redevelop its recommendation system for US users, using only their data. That’s the basic premise of the executive order that President Trump is set to sign later this week. It will stay any enforcement action for 120 days while the settlement agreement can be reached.
Industry insiders, including many YouTube stars, warned of the dire effects on user engagement and content creators. Jasmine Enberg, principal social media analyst at eMarketer, noted that changes to the app’s algorithm or policies could lead to significant shifts in user behavior.
“Material (or even perceived) changes to the content, algorithm or app policies could prompt massive shifts in user behaviour.” – Jasmine Enberg, principal social media analyst at eMarketer
The fiscal consequences of this agreement would be huge — almost certainly in the billions. Silver Lake, a private equity firm, is involved in the negotiations, highlighting the investment interest surrounding TikTok’s operations in the US market. Larry Ellison, Oracle’s co-founder and chairman, was previously considered a possible TikTok buyer. This introduces a new layer of complexity to the intense discussions still happening.
Now Oracle is experiencing a boom in demand for its data centers from AI firms. This type of partnership enables TikTok to tap into existing, robust infrastructure while ensuring adherence to US regulatory guardrails. Analysts caution that any changes in how TikTok operates could risk alienating its user base and diminish its appeal to creators and brands alike.