Chinese tech giant ByteDance has categorically denied plans to sell TikTok, despite a new US law setting a nine-month deadline for the company to divest from the popular video platform or face a ban in the United States.
The US lawmakers’ move is based on national security concerns, alleging that TikTok can be used by the Chinese government for espionage and propaganda as long as it is owned by ByteDance.
ByteDance’s denial comes after a report by The Information, a tech-focused US news site, suggested that the company was exploring scenarios for selling TikTok without its powerful secret algorithm that recommends videos to its over one billion users worldwide. However, ByteDance has dismissed the report, stating that “foreign media reports about ByteDance exploring the sale of TikTok are untrue” and that it has “no plans to sell TikTok”
TikTok has been a political and diplomatic hot potato for years, with the company facing intense scrutiny from US lawmakers and regulators. Despite its denials of any links to the Chinese government, TikTok has been accused of posing a national security risk due to its data collection practices and algorithm. The company has spent around $1.5 billion on “Project Texas”, which was aimed at storing US user data in the United States, but its critics argue that this is only part of the problem.
The estimated valuations of TikTok are in the tens of billions of dollars, and any forced sale would present major complications. US tech giants such as Meta or Google would likely be blocked from buying the app due to competition concerns, while Beijing has designated TikTok’s recommendation algorithm as protected technology, requiring approval for any sale.
ByteDance has enjoyed explosive growth in recent years, becoming one of the most valuable companies in the world, with international investors including US firms General Atlantic and SIG, as well as Japan’s SoftBank, holding stakes worth billions. While TikTok is a global phenomenon, it represents a small fraction of ByteDance’s revenue, according to analysts and investors.
In a statement, ByteDance investor Mitchell Green of Lead Edge Capital said, “TikTok US is a very small part of the overall business… If it was kicked out of the US, we would not sell.” The company’s CEO, Shou Zi Chew, has also vowed to take the fight against the new law to the courts.