China’s ByteDance has agreed to divest its TikTok operations in the US, according to a report in Reuters. Under the deal, Microsoft would take over stewardship of the data of U.S.-based users. The deal allows another company besides Microsoft to operate TikTok in the United States. This would allow the service to continue to operate in the United States, sidestepping the alleged executive order threatened by President Trump.
Allegedly, ByteDance had previously sought a deal that would allow the company to retain a minority stake in the company. That plan was apparently recently abandoned after the White House rejected the proposal.
Under this new deal, Microsoft would be in charge of protecting U.S.-based users’ data, and another U.S.-based company would be allowed to operate TikTok .
It’s unclear if this deal would be enough to allow TikTok to continue to operate within the United States.
Microsoft and the White House did not respond to a request for comment.
This news comes hours after President Trump told reporters that he was going to sign an executive order banning the Chinese-owned app from operating within the United States. In response, ByteDance issued the following statement, which we initially reported here.
“100 million Americans come to TikTok for entertainment and connection, especially during the pandemic. We’ve hired nearly 1,000 people to our US team this year alone, and are proud to be hiring another 10,000 employees into great paying jobs across the US. Our $1 billion creator fund supports US creators who are building livelihoods from our platform. TikTok US user data is stored in the US, with strict controls on employee access. TikTok’s biggest investors come from the US. We are committed to protecting our users’ privacy and safety as we continue working to bring joy to families and meaningful careers to those who create on our platform,” said a TikTok spokesperson.