In a significant move shortly after his inauguration, President Donald Trump has indicated that the future of TikTok in the United States could be tied to a deal regarding its ownership.
He signed an executive order that temporarily allows the popular short-form video platform to continue operating in the U.S. for an additional 75 days, while also postponing a deadline for its Chinese parent company, ByteDance, to divest its stake in the app.
During a press conference, Trump stated that if TikTok remains operational beyond the new deadline, the U.S. should be entitled to receive “half of TikTok’s value.”
He suggested that if a deal is not reached, he could impose tariffs on China, which he described as a “hostile act.” The President hinted that these tariffs could be as high as 100 percent, emphasizing that such measures would likely compel Beijing to agree to a deal.
On his first day in office, Trump reiterated his stance on tariffs, threatening to impose a 25 percent levy on imports from Canada and Mexico starting February 1.
However, he refrained from implementing the sweeping 60 percent tariffs on Chinese goods that he had previously promised during his campaign, which would have escalated the ongoing trade war with China.
The decision to delay tariffs against China appears to serve as a strategic bargaining chip in negotiations over TikTok. Trump revealed that he had discussed the TikTok situation with Chinese President Xi Jinping, although there was no confirmation from Beijing regarding the conversation.
Following the initial deadline under the “divest or ban” law, TikTok briefly became unavailable to approximately 170 million U.S. users at midnight on Sunday, but service was restored just hours later.
The executive order signed by Trump protects companies that distribute and host TikTok, including major players like Apple, Google, and Oracle, from facing penalties during the 75-day extension. Under the law, these service providers could have faced fines of $5,000 per user for non-compliance.
Senator Tom Cotton, a Republican and head of the Senate Intelligence Committee, cautioned these companies against violating the law, warning that they could face “ruinous bankruptcy.”
In the wake of Trump’s comments, TikTok’s CEO, Shou Zi Chew, has been actively engaging with U.S. officials, hoping to find a resolution that would allow the app to remain operational.
TikTok has also argued that divesting from ByteDance within the stipulated timeframe is not technologically feasible, while Chinese officials have expressed that a sale is not the preferred option.
Trump’s remarks about TikTok’s valuation were striking; he claimed that if he does not broker a deal, the app would be “worthless,” but if a deal is made, it could be valued at “maybe a trillion dollars.” This assertion underscores the high stakes involved in the negotiations.
Reports have emerged suggesting that Chinese officials are considering Elon Musk, a close associate of Trump, as a potential intermediary in the sale of TikTok’s U.S. operations. Musk met with China’s Vice President Han Zheng on the day of Trump’s inauguration, further fueling speculation about his role in the negotiations.
Musk has also criticized the disparity between TikTok’s presence in the U.S. and the ban on Western social media platforms in China, calling the situation “unbalanced” and indicating that “something needs to change.”
As of now, Beijing has not publicly responded to Trump’s threats regarding tariffs if a TikTok deal is not reached. On the same day, China’s foreign ministry stated that any decisions regarding TikTok’s ownership should be made based on market principles and determined by the companies involved.
The unfolding situation surrounding TikTok and its ownership highlights the complex interplay between technology, international trade, and diplomatic relations, as both the U.S. and China navigate this contentious issue.
