TikTok is once again at the center of controversy as U.S. Commerce Secretary Howard Lutnick pressures ByteDance to relinquish control of the popular app’s American operations. The stakes are high for the app, which has captivated around 170 million users in the United States, with a potential shutdown still looming if ByteDance does not comply. The proposed solution aims to establish a new U.S.-based version of TikTok, which would be predominantly owned and managed by American investors.
Although ByteDance could retain a minor stake, the crux of the debate centers around the app’s algorithm—the technology that curates content seen by users. Lutnick insists that not only must the U.S. own TikTok’s infrastructure, but it must also control the algorithm to ensure American interests are protected. Historically, similar demands for a TikTok divestiture have arisen.
A law enacted in 2024 mandated that ByteDance must either divest or cease TikTok’s U.S. operations by January 19, 2025. This deadline has been extended three times by former President Trump, with the latest extension set for September 17. Unfortunately, these delays have not significantly advanced negotiations.
Progress appeared possible earlier in the year, but discussions faltered when China indicated it would not approve any transaction, particularly following new tariffs imposed by Trump on Chinese imports. The situation has sparked legal challenges and political disputes, with some Democratic lawmakers questioning the legality of extending deadlines and whether the proposed arrangement meets the 2024 law’s criteria. Amid these developments, companies like Blackstone have exited the bidding to acquire TikTok’s U.S. operations, citing uncertainties stemming from U.S.-China trade tensions.
Given the current trajectory, it seems unlikely that a resolution will be reached by the September deadline.