TikTok Diminishes the "Shadow of China," Strengthening the Shadow of Politics - The Cost of Avoiding a Ban with a New US Entity

TikTok Diminishes the "Shadow of China," Strengthening the Shadow of Politics - The Cost of Avoiding a Ban with a New US Entity

A significant amount of time has passed since the idea of a "TikTok ban" in the United States became a tangible possibility. However, in January 2026, a resolution was finally reached. ByteDance's TikTok announced the establishment of a new company, "TikTok USDS Joint Venture LLC (USDS JV)," where U.S. investors hold the majority stake, allowing TikTok to continue its services in the U.S.


The condition to avoid a ban lies more in "control" than "ownership"

The key point this time is not merely an adjustment of shareholding. The U.S. has long been concerned not only with the handling of personal data but also with the influence of the "recommendation algorithm" that can sway society.


USDS JV will manage U.S. user data, U.S.-oriented app operations, and the operational infrastructure of recommendation algorithms in compliance with U.S. regulatory requirements. The announcement highlighted "data protection," "algorithm safety," "content moderation," and "software assurance" as pillars, promising operations that include audits, third-party certifications, and ongoing transparency reports.


Shareholding and key players of the new company: The role of Oracle and the "seven-member board of directors"

According to disclosed information, ByteDance's stake is limited to 19.9%, with the remaining 80.1% held by "non-Chinese" investors. The core "management investors" are three companies: Oracle, Silver Lake, and MGX, each holding 15%. Additional investors will join, forming a board of directors with seven members. Adam Presser, who has been responsible for TikTok's operations and trust and safety, will become the CEO, and Will Farrell will be the Chief Security Officer (CSO). TikTok's CEO, Shou Chew, will also participate as a director.


The most crucial aspect seems to be Oracle's position. As a "trusted security partner," Oracle will protect U.S. user data within its U.S. cloud and will be involved in reviewing and verifying source code. This creates a framework where U.S. companies can institutionally step into areas previously considered "black boxes."


Will the app change, or will the feed change? — The possibility of "the same app, different content"

From a user perspective, a significant concern is, "Will it become a different app tomorrow?" Based on current reports, the direction of "replacing the app" seems to be receding, and it is likely that users will be able to continue using the same app.


However, the experience may not be exactly the same. USDS JV has stated its intention to retrain, test, and update the recommendation algorithm using U.S. user data. This is essentially a process of "retraining the heart of the U.S. version with U.S. blood."


This is where it gets tricky, as TikTok's appeal lies in its "global scale of enthusiasm" and "precision of personal optimization." As retraining progresses, there is a possibility that U.S. trends will become more distinctly American, while the chance for serendipitous global discoveries may diminish. Furthermore, no matter how carefully adjustments are made, retraining the algorithm will inevitably lead to subtle changes in the feed. This is precisely the area where SNS reacts sensitively.


Who holds the revenue? The division of "back-end" and "front-end" becomes apparent

Another point not to be overlooked is that USDS JV does not hold "everything." Reports suggest that while USDS JV primarily handles the back-end (data, algorithms, and the core of U.S. operations), the revenue areas such as advertising and commerce might be operated under a separate framework.


In other words, the U.S. side manages the "data," "recommendations," and "security risks" that the U.S. government has been concerned about, while the massive commercial engine itself may still be influenced by ByteDance — this "separation design" can be inferred.


This design is rational. It suppresses security concerns while not halting TikTok's business. However, it also raises doubts about "how much was truly separated?" The subsequent SNS reactions are precisely focused on this point.


SNS reactions: Relief, irony, and "from China to 'another power'?"

Following the confirmation of this deal, three major reactions stand out on SNS.


1) Relief: "At least it didn't disappear"
For creators and small businesses, TikTok is a lifeline for revenue and customer acquisition. Given that a ban or suspension had been discussed as a "real risk," there is strong relief that "continuation has been confirmed." Setting politics aside, there is a sense that their livelihoods have been protected.


2) Irony and distrust: "Isn't it just another ruler instead of China?"
On Reddit, comments mocking the situation as a "change of rulers" are among the top. The view is that "instead of China, another political force, tycoon, or Gulf capital will control the algorithm." Indeed, threads feature posts with a tone like, "It's great that the UAE and a group of billionaires from specific political forces will control the algorithm (sarcasm)."
There is a backlash against the idea that the guise of national security justifies another concentration of power.


3) Questions about the system: "Were deadlines and transparency upheld?"
Similarly, on Reddit, procedural doubts are raised, such as "If it was established beyond the legal deadline, will it be stopped by a lawsuit?" Additionally, criticism from Congress about "lack of details" and "insufficient transparency" has been reported, indicating that the issue is not fully resolved.


In SNS terms, it's not a "finished story," but rather a "new topic for controversy."


Additionally, symbolic were the posts by politicians themselves. Comments welcoming the agreement spread on social media, simultaneously provoking backlash with sentiments like "Is TikTok a political trophy?" Considering the history of TikTok debates being used as tools for cultural and factional wars rather than tech policy, this is a natural reaction.


An era where the definition of "safety" changes: Audits and standard compliance are not omnipotent

USDS JV presents a very "exemplary" security explanation for a tech company, including third-party audits, standard compliance, continuous source code review, and transparency reports. Indeed, these are important.


However, what SNS questions is, "The system is impressive, but who decides the operation?"


An algorithm is not just software. It holds power akin to "editorial rights," deciding which posts to elevate and which to suppress. Even with audits, if the objective functions of recommendations or the priorities of moderation change, the impact on society will alter. Therefore, this agreement is not the "end point" of ban avoidance but the "starting point" for governance and transparency.


Future focus: The app continues, and so does the debate

In the short term, TikTok is expected to continue being used in the U.S. However, three points should be noted in the medium term.

  • Changes in the feed: After retraining progresses, will users feel "something's different," or will it be seamlessly optimized?

  • Additional transparency disclosures: How much information will Congress and regulatory authorities demand, and how much will companies disclose?

  • Sustainability of the "division of labor model": How will the system that separates the security core from the commercial engine change decision-making and responsibility boundaries on the ground?


TikTok has avoided a "ban." However, in exchange, the question of "who governs TikTok" has been sharply posed. SNS simultaneously shouting welcome and suspicion is because this question is directly connected to our timelines.


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