What is this TikTok deal Trump keeps talking about?

U.S. President Donald Trump will sign an executive order Thursday confirming that a deal to divest TikTok’s U.S. operations from its Chinese owner ByteDance will meet the requirements set out in a 2024 law, a White House source told Reuters Wednesday. 

The long-awaited agreement would allow TikTok to continue operating in the U.S., after months of uncertainty and government threats of permanently banning the social media app that has 170 million U.S. users.

Trump said last week he had reached an agreement with China, but offered few details. 

Here’s what we know so far.

Why is a deal being negotiated?

U.S. Congress passed a law in 2024 during the Biden administration that required TikTok’s American assets to be transferred to U.S. owners, citing fears that its U.S. user data could be accessed by the Chinese government. Under Chinese law, ByteDance would be required to hand over data on Americans if authorities asked for it, but TikTok says it has never received such a request. It also says its U.S. data is stored outside of China. 

The Trump administration has not enforced the law, instead extending the deadline to get a deal done three times. Meanwhile, Trump has credited TikTok with helping him win the 2024 election, and the White House launched an official account last month.

Last Tuesday, Trump said a deal was reached, adding, “We have a group of very big companies that want to buy it.” The White House gave ByteDance until Dec. 16 to finalize the agreement.

A Chinese trade representative confirmed the two sides had reached a “basic framework consensus.”

Trump discussed the deal in a phone call with Chinese President Xi Jinping on Friday, and told reporters that Xi “approved” the deal. China, however, did not confirm this. 

Who are the investors?

Many details on the new ownership structure remain unclear.

On Saturday, White House press secretary Karoline Leavitt said Texas-based Oracle would be responsible for the app’s data and security. Oracle will also lead U.S. oversight of the app’s algorithm, which has been at the centre of the controversy, with U.S. officials warning it could be manipulated by Chinese authorities. 

Oracle currently hosts the cloud servers that store TikTok’s content recommendation engine and user data in the U.S.

Private equity firm Silver Lake is also reportedly part of a consortium of investors expected to take over U.S. operations.

Sources told Reuters that ByteDance will keep the largest single ownership stake, at 19.9 per cent, just under the law’s 20 per cent threshold.

Reports cited by The Associated Press have also named among the U.S. bidders Microsoft, Amazon, billionaire Frank McCourt and a consortium led by the founder of OnlyFans.

And in an interview that aired Sunday on Fox, Trump said media mogul Rupert Murdoch and tech founder Michael Dell could be part of the deal.

“I think they’re going to be in the group. A couple of others. Really great people, very prominent people,” Trump said. 

Brett Caraway, a professor of media and economics at the University of Toronto, says the deal could signal a continued rightward political shift in the social platform ecosystem in the U.S.

Tech leaders including Meta CEO Mark Zuckerberg have cozied up to Trump since his successful return to the White House, while Elon Musk, who bought Twitter and rebranded it as X in 2022, campaigned for Trump and worked closely with his administration for a time.

Murdoch oversees an empire of right-leaning media outlets, including Fox News, The Wall Street Journal and The New York Post.

Oracle co-founder Larry Ellison, who briefly eclipsed Musk as the world’s richest person this month, is a longtime friend of Trump and recent Republican donor. In 2022, The Washington Post reported that he took part in a conference call to strategize about challenging the legitimacy of the 2020 U.S. presidential election after Trump lost. 

Ellison was the company’s CEO for nearly four decades, and is now its chief technology officer and executive chair.

“I don’t know what the ultimate outcome of this is, but I think there’s a lot of shifting to the right in the hopes of maybe getting some favourable regulatory treatment from the administration, or at least staying out of Donald Trump’s target and not being on his bad side,” Caraway said.

What could this mean for Canada?

Despite his concerns about the deal, Caraway said the fact the U.S. is negotiating with TikTok could be a lesson for Canada.

While Canada has not banned the app for users, several privacy commissioners recently released a joint investigation finding the company collected sensitive information about hundreds of thousands of Canadians under 13 years old. In 2024, then-head of the Canadian Security Intelligence Service David Vigneault advised against using it. 

The Canadian government ordered TikTok to close its Canadian operations in November 2024 following a review of ByteDance, citing unspecified “national security risks.”

Social media experts and content creators warned at the time that the office closure would hurt Canadian creators by reducing opportunities, support systems, grant programs and sponsorships.

TikTok withdrew sponsorships for several Canadian arts institutions in the wake of the decision, including the Juno Awards and Toronto International Film Festival. It also slashed the National Screen Institute’s TikTok Accelerator for Indigenous Creators.

“Just saying that you’re just going to ban the corporate entity in Canada doesn’t seem very productive to me,” Caraway said. 

For better or for worse, he says the U.S. approach seems more fruitful. 

“Maybe it’s cause for the Canadian government to reconsider its approach and try to find a more productive working arrangement with the platform.”