I have no doubt Beijing has made its views on a majority sale clear to ByteDance management. After all, the Chinese government would prefer to see TikTok shut down than forced into American hands, according to a Reuters report.
Yet the second aspect of the deal, as it stands now, is also revealing. Giving Oracle full access to TikTok's codebase indicates ByteDance is confident it'll be just fine if the Americans get to peek under the hood at the software that has made the app such a global sensation. Software and algorithms don't stand still. The TikTok of today is vastly different from the TikTok of a year ago, and the product we'd see next year would be better again. If improvements get slowed, or even halted, under US management then ByteDance probably won't sweat it because it has thousands of engineers tweaking and refining the algorithms at its other products. And since TikTok is only a small part of its business, a certain amount of stagnation won't kill the company.
Of course, that may be a harsh assessment - US software engineers remain the best in the world and would probably do a good job of developing the product. But either way, ByteDance can afford not to care too much as long as it still controls the company and can determine key decisions, such as whether to go for an initial public offering or make an acquisition. It would also remain in the driver's seat should a future US administration reverse course.
That seems to be the Chinese company's endgame. Signing over majority control has a finality that the Chinese company hopes to avoid. Access to the codebase, on the other hand, can be reversed at anytime. ByteDance is playing chicken with President Trump. Let's see who flinches first.For daily updates on weekdays and specially selected content for the weekend. Subscribe to
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Source: The Straits Times - 🏆 8. / 63 Read more »