The News
Beijing is reportedly mulling the sale of TikTok’s US operations to Elon Musk ahead of a Sunday deadline for the app’s owner to sell it to an American company or face a ban in the country.
According to Bloomberg and The Wall Street Journal, the proposal is part of a broader discussion among Chinese officials over Beijing’s stance toward Donald Trump: Establishing closer ties to Musk — a Trump ally who already has a relationship with China as a result of his EV company, Tesla — is among the strategies being considered. ByteDance, which owns TikTok, maintained that its US operation is not for sale, and described the reports of a potential deal with Musk as “pure fiction.”
SIGNALS
TikTok is a casualty of US-China tech tensions
The national security and ideological concerns behind the decision to force a sale or ban TikTok “obscure” the app’s role as “both a catalyst and a metaphor” for the tech rivalry between the US and China, analysts wrote for East Asia Forum, an Australian think tank. A US ban could send a warning to other Chinese companies operating in the country, and “deepen the tech divide” between the two nations, they wrote. A potential ban could carry hidden risks, however, a Center for Strategic International Studies researcher warned: Ideological concerns among some US lawmakers risks echoing China’s “Great Firewall” censorship policy, which, in turn, risk disrupting global commerce and information flows.
Beijing leaning toward letting deadline pass: Reports
Chinese officials have apparently decided that it may be better to let the ban take effect — rather than force a sale — so that negotiations can continue following Donald Trump’s inauguration, The Wall Street Journal reported. Any decisions as to the app’s future that involve Beijing officials, meanwhile, “could raise further debate about whether TikTok is a tool [of the Chinese government]” a China foreign policy expert told the Journal. Trump — who once proposed a TikTok ban himself — has since said he wants the app to remain in the US, although it’s unclear how he might try to reverse the sale-or-ban law.
Would Musk buy TikTok?
As a staunch ally of Donald Trump, Elon Musk could prove pivotal to TikTok’s survival: He has disavowed the US ban, and has a history of doing business in China through his EV company, Tesla. The world’s richest man may be constrained by budget, however: Musk is still paying off his Twitter purchase, and TikTok would present an estimated further expense of between $40-$50 billion, Bloomberg noted. Another consideration for Musk is the fact that US TikTokers are already migrating to other apps, including Chinese rival Xiaohongshu, which on Monday was the most downloaded app on Apple’s US App Store, the BBC reported. Combining TikTok’s US operations with Musk’s X platform could boost the latter’s ad sales, however, and its vast library of content would help bolster his AI ambitions.