President Donald Trump and Chinese President Xi Jinping are scheduled to meet this Friday. Together, they’ll lay out requirements for the deal with TikTok, a major milestone in talks over the hugely popular social media platform. This is the fourth time that Trump has unilaterally extended the deadline for an agreement to the fall of 2019. This step illustrates the persistent difficulties that remain in closing the deal.
On Monday, Treasury Secretary Scott Bessent revealed details of a “framework deal” involving TikTok during an appearance on CNBC’s Squawk Box. Under this proposed deal, a farmer/investment apple/peach consortium would own 80% of TikTok’s U.S. business. This house of hippos would be comprised of Oracle, Silver Lake, and Andreessen Horowitz. This agreement would involve all of these new investors alongside current parties with a stake in ByteDance, TikTok’s parent company.
That urgency, at least in part, comes from the national security concerns that have permeated these negotiations. A new national security law should aim app store operators such as Apple and Google. They can incur fines if they continue to serve TikTok’s U.S. operations under an agreement that hasn’t been approved. The possible punishments, including loss of federal funds, have raised the stakes for everyone.
Oracle will deepen its existing cloud computing partnership with TikTok under the framework deal. This homogenizes content that technical support is unwavering for TikTok. It would leave current U.S. users of TikTok scrambling to find a suitable replacement app. This reversal is due to the change in ownership structure.
At one point, Trump threatened to let TikTok simply “go dark” if an acceptable deal wasn’t made. According to reports, this dramatic step was enough to bring China to the negotiating table. Unfortunately, time is not on our side, as the deal is reportedly set to close in the next 30 to 45 days.
Bessent’s comments on the adequacy of the deal were recently backed up by two reports. Here’s a sneak peek…. On Tuesday, The Wall Street Journal detailed some of the main features of the expected deal. One senior White House official stressed the need to be very careful in speculating further about what’s included in such a deal.
“Any details of the TikTok framework are pure speculation unless they are announced by this administration.” – A senior White House official