President Trump has given his blessing for TikTok to remain in the U.S. after approving a deal involving Walmart and Oracle taking a financial stake in the company.
However, CNBC reports that Trump’s claims that TikTok’s North American operations have “nothing to do with China” are incorrect. In fact, a new report claims that Beijing-based ByteDance retains an 80% stake in the company.
Trump gave approval to the TikTok deal over the weekend. Under the terms of the deal, Oracle and Walmart gain a financial stake in a company called TikTok Global that will be located in the U.S.
The deal means that Oracle will be the secure cloud provider who will host American users’ data in the country. It will also be able to inspect TikTok source code.
“It’ll be a brand new company,” Trump said. “It will have nothing to do with any outside land, any outside country, it will have nothing to do with China.”
CNBC goes on to note that Trump could claim that TikTok Global is majority owned by U.S. companies. That’s because ByteDance is 40% owned by venture firms based in the U.S., although it is headquartered in China. Even so, if accurate this is a far cry from “nothing to do” with China. U.S. Secretary of State Mike Pompeo told Fox News that ByteDance will be more like a “passive shareholder” than an active player.
Trump and TikTok
Had Trump not given TikTok an eleventh hour reprieve, the popular video sharing app would have found itself out of the App Store today. Trump planned to block TikTok in the U.S. as a result of security concerns unless it was bought by an American company.
TikTok is one of the most popular apps in the App Store. In the first three months of 2020, it enjoyed the best quarter of any app ever. In the U.S., it currently has around 100 million monthly users.