The Chinese government is reportedly holding discussions to sell TikTok U.S. operations to billionaire Elon Musk.
According to a Bloomberg report, this is being considered as the next possible option should the U.S. Supreme Court uphold the law banning the app on January 19.
Citing people familiar with the matter, Bloomberg reported that Beijing officials strongly prefer that TikTok remains under the ownership of parent ByteDance Ltd., and the company is contesting the impending ban with an appeal to the US Supreme Court.
But the justices signaled during arguments on January 10 that they are likely to uphold the law, a development which prompted Senior Chinese officials to start contingency plans for TikTok as part of an expansive discussion on how to work with Donald Trump’s administration.
Musk is one of the key financiers of the President Trump’s election campaign and he is expected to play a big role in the incoming administration.
What this means
If this scenario comes to play, Musk’s X would acquire TikTok US, effectively absorbing the vertical video platform’s 170 million American users and billions in potential ad revenue.
Meanwhile, the report states it is unclear how much ByteDance and TikTok know about China’s discussions of a Musk sale, potentially highlighting China’s alleged influence over the platform that brought about this law in the first place.
Backstory
Last year, President Joe Biden signed legislation into law that requires TikTok’s parent company, ByteDance, to sell the popular social media platform or face a ban on national security grounds.
- The social media giant wants to delay enforcing the law, scheduled for Jan. 19, which they say violates the U.S. Constitution’s First Amendment protection against government abridgment of free speech.
- If the ban takes effect on Sunday, Apple and Google would no longer be able to offer TikTok for downloads for new users, but existing users could still access the app.
- The U.S. government and TikTok agree that the app would degrade and eventually become unusable over time because companies would not be able to offer support services.
- President-elect Donald Trump is scheduled to be sworn into office on Jan. 20 – just one day after the ban could be implemented.
- In late December, Trump urged the court to put a hold on the Jan. 19 deadline to give his incoming administration the opportunity to pursue a political resolution of the questions at issue in the case.
