China Considers Alternative Options for TikTok’s US Operations
Chinese officials are reportedly exploring alternative options for TikTok’s US operations, should the company fail to overcome the impending ban on the application in the country.
ByteDance’s Preferred Outcome
Beijing officials have expressed a preference for TikTok to remain under the ownership of China’s ByteDance. The company has appealed the ban to the US Supreme Court, and officials are hopeful that the appeal will be successful.
Contingency Plans
However, in the event that the appeal is unsuccessful, officials have begun discussing contingency plans for TikTok. One possible scenario involves Elon Musk, a close ally of former US President Donald Trump, acquiring the company’s US operations.
Musk has a history of supporting Trump, having spent over $250 million on his re-election campaign. He has also been tapped to play a leading role in improving government efficiency.
Valuation of TikTok’s US Operations
Analysts estimate that TikTok’s US operations could be valued between $40 billion and $50 billion. This is comparable to the $44 billion Musk paid for Twitter in 2022.
Chinese Government’s Influence
The Chinese government owns a ‘golden share’ in a subsidiary of ByteDance, giving it influence over the company’s strategy and operations. However, TikTok maintains that this control only applies to the China-based subsidiary, Douyin Information Service, and has no bearing on ByteDance’s operations outside of China.
Uncertainty Surrounding TikTok’s Fate
Despite the ongoing discussions, it is unclear how much ByteDance knows about the Chinese government’s plans or whether TikTok and Musk have been involved in talks. The fate of TikTok’s US operations remains uncertain, and it is unclear what the future holds for the company.