TikTok's Chinese-owned parent company ByteDance is reportedly planning to hold an initial public offering in the U.S. if President Donald Trump approves a deal with Oracle. The move hopes to avert Trump's ban of the popular app set to take effect next week.
<p>On Wednesday, the Treasury Department provided ByteDance with revisions to the agreement the two companies have tentatively signed off on. Various media reported that Oracle will own a stake of TikTok, but how much each would own is unclear. <a href="https://www.wsj.com/articles/white-house-concerns-grow-over-emerging-tiktok-deal-with-oracle-11600359798" rel="noopener noreferrer" target="_blank">Walmart may also be part of that arrangement</a>. Any deal still must be cleared by Trump.</p><p>Walmart had previously sought to join a deal with Microsoft Corp, but <a href="https://dot.la/oracle-wins-bid-for-tiktok-2647641268/a-tiktok-timeline-the-rise-and-pause-of-a-social-video-giant" target="_self">their bid was rejected</a> by ByteDance. </p><p>TikTok is also <a href="https://www.nytimes.com/2020/09/17/technology/tiktok-deal-revisions-trump-review.html" target="_blank">reportedly</a> hunting for a new CEO and multiple outlets Thursday report Instagram co-founder Kevin Systrom is being considered. </p><p>Sunday will mark 45 days since Trump signed an executive order stating TikTok must strike a deal in the country or risk being banned. The administration accuses TikTok of collecting U.S. users data and sharing it with the Chinese government, a risk to national security. TikTok denies this.</p>If TikTok went public, it could be one of the largest tech IPOs yet. Some investors have valued the company <a href="https://www.reuters.com/article/us-bytedance-tiktok-exclusive/exclusive-bytedance-investors-value-tiktok-at-50-billion-in-takeover-bid-sources-idUSKCN24U1M9" rel="noopener noreferrer" target="_blank">at $50 billion</a>.
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U.S.-based TikTok employees should still get paid if President Donald Trump's executive order to ban "transactions" with the company goes into effect next week, the Justice Department said in a court filing on Monday.
The concession is in response to a lawsuit filed last month by TikTok technical program manager Patrick S. Ryan in the U.S. District Court of the Northern District of California accusing Trump of violating his constitutional rights and defaming and disgracing U.S.-based TikTok Inc. employees by painting them as working for the Chinese Communist Party.
<p>The filling came the same day Oracle confirmed that TikTok's parent company <a href="https://dot.la/oracle-wins-bid-for-tiktok-2647641268/a-tiktok-timeline-the-rise-and-pause-of-a-social-video-giant" target="_self">ByteDance Ltd has chosen the Bay Area software giant </a> as its "trusted technology provider." Trump has pushed for TikTok's sale to a U.S. company, favoring Oracle Corp.</p><p>TikTok found itself in the Trump administration's line of fire over concerns that China-based ByteDance is sharing the popular app's data with the Communist government. On August 6, Trump issued an <a href="https://www.whitehouse.gov/presidential-actions/executive-order-addressing-threat-posed-tiktok/" rel="noopener noreferrer" target="_blank">executive order</a> giving the app 45 days before "transactions" with the platform are banned. But it offered no explanation as to what those transactions include.</p><p>"The government conceded at the eleventh hour because they knew they were going to lose," said Alexander Urbelis, a partner at Blackstone Law Group LLP, which represents Ryan. "We think that the government may have conceded all of our asks because they did not want to risk the court addressing the broader issue of whether Trump's executive order is unconstitutional."</p><p>Justice Department lawyers said the administration "does not intend to implement or enforce" the executive order in a way that would prohibit paying wages, salaries or benefits to TikTok employees or contractors. So, there is no need to hit pause on Trump's ban.</p><p>But, they made no assurances that Trump's order won't have an impact on employees should ByteDance and TikTok decide to restructure or change employee payments as a result. Blackstone Law Group's lead attorney John D. Lovi said in a letter to the Justice Department Monday that the government still hasn't addressed concerns that Trump's order harms the reputation of U.S.-based TikTok employees, nor has it addressed the holdup on H-1B visas because of the order.</p><p>A representative for the Justice Department did not immediately reply to a request for comment. A court clerk on Monday called off a hearing on the case set to hear the request to pause the ban on Tuesday morning.</p><p><em>___</em></p><p><em>Do you have a story that needs to be told? My DMs are open on Twitter </em><a href="https://twitter.com/latams" rel="noopener noreferrer" target="_blank"><em>@latams</em></a><em>. You can also email me at tami(at)dot.la, or ask for my contact on Signal, for more secure and private communications.</em></p>
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See our timeline below for key developments TikTok's story over the last eight years, starting with the founding of ByteDance and moving through the app's rise to popularity and the mounting concerns about data privacy and security.
<p><strong>March 2012:</strong> Internet entrepreneur Zhang Yiming founds ByteDance in Beijing.</p><p><strong>August 2012: </strong>ByteDance launches its first product, Toutiao, an AI-powered news aggregator.</p><p><strong>July 2014:</strong> Alex Zhu <a href="https://www.businessinsider.com/tiktok-head-alex-zhu-musically-china-life-bio-2019-11#zhu-thought-about-how-he-could-combine-these-different-features-into-a-single-social-app-for-teens-and-the-idea-for-musically-was-born-the-team-behind-cicada-turned-zhus-idea-into-an-app-in-only-30-days-and-in-july-2014-launched-musically-for-creating-15-second-lip-syncing-music-videos-9" target="_blank">launches Musical.ly</a>, an app that enables users to create short-form lipsync music videos; Musical.ly is headquartered in Shanghai with an office in Santa Monica.</p><p><strong>July 2015: </strong>Musical.ly <a href="https://www.businessinsider.com/how-musically-became-so-successful-2016-6" rel="noopener noreferrer" target="_blank">hits #1</a> in Apple app store.</p><p><strong>September 2016:</strong> ByteDance launches Douyin, an app with similar functionality as Musical.ly; within a year, the Chinese app achieves 100 million users and 1 billion views/ day.</p><p><strong>September 2017: </strong>ByteDance brings Douyin <a href="https://www.businessinsider.com/tiktok-app-online-website-video-sharing-2019-7#in-september-2017-douyin-expanded-outside-of-china-to-select-international-markets-under-a-new-name-tiktok-the-platform-quickly-rose-to-the-top-of-the-charts-in-thailand-japan-and-other-asian-markets-7" rel="noopener noreferrer" target="_blank">outside of China</a>'s Great Firewall under the name of TikTok; the app does well in numerous Asian markets.</p><p><strong>November 2017</strong>: ByteDance acquires Musical.ly for $1 billion; the company starts operating <a href="https://www.businessinsider.com/tiktok-app-online-website-video-sharing-2019-7#in-november-2017-douyins-parent-company-bytedance-purchased-musically-in-a-deal-valued-at-1-billion-bytedance-first-operated-the-two-short-form-video-apps-as-two-separate-platforms-musically-in-the-us-and-tiktok-in-other-foreign-markets-9" rel="noopener noreferrer" target="_blank">Musical.ly in the US</a>, Douyin in China and TikTok in other markets.</p><p><strong>August 2018:</strong> ByteDance merges Musical.ly with TikTok and migrates all user profiles to TikTok; Alex Zhu becomes TikTok senior vice president, saying, "Combining Musical.ly and TikTok is a natural fit given the shared mission of both experiences – to create a community where everyone can be a creator."</p><p><strong>October 2018: </strong>ByteDance <a href="https://www.bloomberg.com/news/articles/2018-10-26/bytedance-is-said-to-secure-funding-at-record-75-billion-value?sref=QjdS4d5U" rel="noopener noreferrer" target="_blank">achieves a record $75 billion valuation</a>, making it the world's biggest privately backed startup.</p><p><strong>February 2019:</strong> Lil Nas X releases "Old Town Road" on TikTok, catalyzing a viral sensation that ultimately reaches #1 on Billboard's charts.</p><p><strong>February 2019:</strong> TikTok is <a href="https://www.vox.com/the-goods/2019/2/28/18244996/tiktok-children-privacy-data-ftc-settlement" rel="noopener noreferrer" target="_blank">fined $5.7 million</a> for child data privacy violations.</p><p><strong>September 2019:</strong> <a href="https://www.washingtonpost.com/technology/2019/09/15/tiktoks-beijing-roots-fuel-censorship-suspicion-it-builds-huge-us-audience/" rel="noopener noreferrer" target="_blank">Washington Post reports</a> that TikTok may be censoring protests in Hong Kong.</p><p><strong>September 2019:</strong> Leaked documents show TikTok instructs its moderators to censor videos that mention various subjects deemed offensive by the Chinese government and Commuist Party, T<a href="https://www.theguardian.com/technology/2019/sep/25/revealed-how-tiktok-censors-videos-that-do-not-please-beijing" rel="noopener noreferrer" target="_blank">he Guardian reports</a>.</p><p><strong>October 2019: </strong>U.S. Senator Marco Rubio <a href="https://cdn.vox-cdn.com/uploads/chorus_asset/file/19273614/20191009_Letter_to_Secretary_Mnuchin_re_TikTok.pdf" rel="noopener noreferrer" target="_blank">calls on the U.S. government</a> to investigate the national security implications of ByteDance's acquisition of Musical.ly, citing concerns over the Chinese government and Communist Party's use of TikTok to censor content and silence open discussion.</p><p><strong>October 2019:</strong> U.S. Senators Chuck Schumer and Tom Cotton <a href="https://www.democrats.senate.gov/newsroom/press-releases/leader-schumer-senator-cotton-request-assessment-of-national-security-risks-posed-by-china-owned-video-sharing-platform-tiktok-a-potential-counterintelligence-threat-with-over-110-million-downloads-in-us-alone" rel="noopener noreferrer" target="_blank">ask U.S. Acting Director of National Intelligence</a> to assess the national security risks from TikTok and other Chinese-owned apps, and request a congressional briefing on the findings.</p><p><strong>October 2019: </strong>Alex Zhu begins reporting directly to ByteDance head Zhang Yiming; he had previously reported to the head of Douyin.</p><p><strong>November 2019: </strong>The U.S. government <a href="https://www.reuters.com/article/us-tiktok-cfius-exclusive/exclusive-u-s-opens-national-security-investigation-into-tiktok-sources-idUSKBN1XB4IL" rel="noopener noreferrer" target="_blank">launches an investigation</a> into ByteDance's acquisition of Musical.ly on the grounds that ByteDance did not seek clearance when it acquired Musical.ly.</p><p>TikTok reportedly has 26.5 million monthly active users in the U.S. at this time.</p><p><strong>December 2019: </strong>The U.S. Defense Department's Defense Information Systems Agency issues a recommendation that military personnel delete TikTok from all smartphones.</p><p>Q4 2019: TikTok becomes the <a href="https://9to5mac.com/2020/01/14/most-downloaded-ios-app-2/" rel="noopener noreferrer" target="_blank">most downloaded app</a> in the world and second in the U.S.</p><p><strong>January 2020:</strong> Several <a href="https://www.nytimes.com/2020/01/04/us/tiktok-pentagon-military-ban.html" rel="noopener noreferrer" target="_blank">U.S. military branches ban</a> TikTok on government-issued smartphones.</p><p><strong>March 2020: </strong>U.S. officials <a href="https://www.cnet.com/news/us-officials-in-contact-with-tiktok-over-political-disinformation/" rel="noopener noreferrer" target="_blank">reach out to TikTok</a> to discuss political disinformation.</p><p><strong>April 2020:</strong> TikTok <a href="https://www.businessinsider.com/tiktok-app-2-billion-downloads-record-setting-q1-sensor-tower-2020-4" rel="noopener noreferrer" target="_blank">surpasses 2 billion downloads and sets the record</a> for quarterly downloads.</p><p><strong>May 2020:</strong> Various <a href="https://dot.la/tiktok-privacy-issues-2646002525.html" target="_self">child privacy groups file a complaint</a> with the U.S. Federal Trade Commission that TikTok is violating the Children's Online Privacy Protection Act (COPPA) and flouting terms agreed to following its February 2019 settlement.</p><p>A TikTok spokesperson says the company "takes the issue of safety seriously for all our users, and we continue to further strengthen our safeguards and introduce new measures to protect young people on the app."</p><p><strong>May 2020:</strong> ByteDance <a href="https://dot.la/kevin-mayer-leaves-disney-for-tiktok-chapek-regime-moves-on-2646028687.html" target="_self">hires former Disney executive Kevin Mayer</a> as chief operating officer and TikTok chief executive officer.</p><p><strong>June 2020:</strong> Teens <a href="https://www.bloomberg.com/news/articles/2020-06-21/tiktok-teens-reserved-trump-tulsa-tickets-with-no-plans-to-go?sref=QjdS4d5U" rel="noopener noreferrer" target="_blank">organize on TikTok to fool Trump administration</a> into anticipating high attendance for the President's Tulsa, Oklahoma campaign rally.</p><p><strong>June 2020:</strong> India <a href="https://pib.gov.in/PressReleseDetailm.aspx?PRID=1635206" rel="noopener noreferrer" target="_blank">bans 59 Chinese apps including TikTok</a>, citing national security and data privacy concerns; the move comes amid ongoing <a href="https://www.nytimes.com/interactive/2020/07/18/world/asia/china-india-border-conflict.html" rel="noopener noreferrer" target="_blank">skirmishes between the two countries on the China-India border</a>.</p><p><strong>July 2020: </strong>Australia Prime Minister Scott Morrison <a href="https://www.dailymail.co.uk/news/article-8533999/Scott-Morrison-launch-investigation-TikTok.html" rel="noopener noreferrer" target="_blank">launches an investigation into TikTok</a> surrounding data concerns.</p><p><strong>July 2020:</strong> U.S. Secretary of State Mike Pompeo confirms the U.S. is <a href="https://www.businessinsider.com/pompeo-says-us-certainly-considering-banning-tiktok-fox-news-2020-7?r=US&IR=T" rel="noopener noreferrer" target="_blank">looking into banning TikTok</a> over concerns the app is sharing data with China; the next day, President Trump <a href="https://www.bloomberg.com/news/articles/2020-07-07/tiktok-touts-u-s-ties-after-pompeo-threatens-to-ban-social-app?sref=QjdS4d5U" rel="noopener noreferrer" target="_blank">says he is considering a ban</a>, framing it as a potential retaliation tactic against China for its handling of the coronavirus pandemic.</p><p><strong>Aug. 2, 2020:</strong> Microsoft issues a <a href="https://blogs.microsoft.com/blog/2020/08/02/microsoft-to-continue-discussions-on-potential-tiktok-purchase-in-the-united-states/" rel="noopener noreferrer" target="_blank">blog post</a> citing a conversation between chief executive Satya Nadella and President Trump around the company's potential acquisition of TikTok.</p><p><strong>Aug. 4, 2020: </strong>Australia Prime Minister <a href="https://www.reuters.com/article/us-usa-tiktok-australia/australian-pm-says-no-evidence-to-suggest-tiktok-should-be-banned-idUSKCN25032K" rel="noopener noreferrer" target="_blank">Scott Morrisson says there is not sufficient evidence</a> to suggest a TikTok ban is necessary.</p><p><strong>Aug. 6, 2020:</strong> President Trump <a href="https://www.whitehouse.gov/presidential-actions/executive-order-addressing-threat-posed-tiktok/" rel="noopener noreferrer" target="_blank">issues an executive order</a> banning American companies from transacting with ByteDance or its subsidiaries, namely TikTok; the U.S. Secretary of Commerce is to identify specific prohibited "transactions" 45 days after the order is issued.</p><p><strong>Aug. 14, 2020: </strong>Trump issues another <a href="https://www.whitehouse.gov/presidential-actions/order-regarding-acquisition-musical-ly-bytedance-ltd/" rel="noopener noreferrer" target="_blank">executive order demanding</a> ByteDance "divest all interests and rights" in its assets and property that enable TikTok's U.S. operations, and data collected via TikTok in the U.S., within 90 days. The order says the U.S. investigation into ByteDance's acquisition of Musical.ly presented "credible evidence" that ByteDance "might take action that threatens to impair the national security of the United States."</p><p><strong>Aug. 17, 2020: </strong>Oracle enters the discussion as a <a href="https://www.ft.com/content/272cfc69-b268-45ac-88d6-d55821f27e78" rel="noopener noreferrer" target="_blank">reported</a> TikTok suitor.</p><p><strong>Aug. 18, 2020: </strong>President Trump says he would support Oracle buying TikTok. Oracle's cofounder and CTO Larry Ellison had previously said he supports Trump and had fundraised for him in February 2020.</p><p><strong>Aug. 24, 2020:</strong> TikTok announces it is <a href="https://newsroom.tiktok.com/en-us/tiktok-files-lawsuit" rel="noopener noreferrer" target="_blank">suing the Trump administration</a> over the ban for failure to protect due process. Separately, a U.S.-based TikTok employee <a href="https://dot.la/tiktok-employee-sues-2647078149.html" target="_self">also sues</a> the administration, stating, "I am a patriot"</p><p><strong>Aug. 26, 2020:</strong> <a href="https://dot.la/kevin-mayer-2647260333.html" target="_self">Kevin Mayer steps down</a> from ByteDance and TikTok, citing a diminished role in a letter to colleagues. Rumors swirl that he was left out of ByteDance's negotiations with potential acquirers</p><p><strong>Aug. 27, 2020:</strong> Walmart <a href="https://corporate.walmart.com/newsroom/2020/08/27/walmart-statement-regarding-discussions-with-microsoft-about-tiktok" rel="noopener noreferrer" target="_blank">issues a statement</a> that it is interested in partnering with Microsoft to acquire TikTok.</p><p><strong>Aug. 28, 2020:</strong> L.A.-based Triller, a TikTok upstart competitor, is <a href="https://www.bloomberg.com/news/articles/2020-08-28/centricus-triller-seeking-to-buy-tiktok-assets-for-20-billion?sref=QjdS4d5U" rel="noopener noreferrer" target="_blank">reported to have issued a bid</a> for TikTok along with investment firm Centricus.</p><p><strong>Aug. 29, 2020:</strong> <a href="https://www.forbes.com/sites/siladityaray/2020/08/29/new-china-export-rule-could-jeopardize-tiktok-us-sale/#200ad10f6960" rel="noopener noreferrer" target="_blank">The Chinese government issues new export rules</a> that complicate the exportation of TikTok's underlying technology – namely its "For You" algorithm – to any foreign buyer.</p><p><strong>Aug. 31, 2020:</strong> <a href="https://www.cnbc.com/2020/08/31/tiktok-deal-to-sell-us-business-could-be-announced-as-soon-as-tomorrow.html" rel="noopener noreferrer" target="_blank">CNBC reports</a> TikTok has chosen a buyer, with an expected sale price of $20 billion - $30 billion.</p><p><strong>Sept. 3, 2020:</strong> With uncertainty over whether a buyer will be able to acquire TikTok's algorithm, and debate mounting over how that affects the value of the company, numerous outlets negotiations are likely to slow as the Chinese government increases its involvement.</p><p><strong>Sept. 13, 2020:</strong> Microsoft <a href="https://blogs.microsoft.com/blog/2020/09/13/microsoft-statement-on-tiktok/" rel="noopener noreferrer" target="_blank">says in a blog post</a> that "ByteDance let us know today they would not be selling TikTok's US operations to Microsoft." The company says it would have made "significant changes" to ensure security, privacy, online safety and combatting disinformation.</p><p><strong>Sept. 14, 2020: </strong>Oracle <a href="https://www.prnewswire.com/news-releases/oracle-confirms-statement-301130173.html" rel="noopener noreferrer" target="_blank">confirms</a> that it has been selected by ByteDance to become a "trusted technology provider" with TikTok. The company says the proposal was submitted by ByteDance to the Treasury Department over the weekend. Treasury Secretary Steven Mnuchin says on CNBC that the proposal includes making TikTok-global a U.S. headquartered company with 20,000 new jobs.</p><p>Mnuchin adds that the Committee on Foreign Investment in the United States is reviewing the proposal this week for national security implications, and will make a recommendation to the president, who will then review the proposal.</p>
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