According to TechCrunch, TikTok has officially signed a deal to divest a portion of its U.S. entity to an American investor group led by Oracle, private equity firm Silver Lake, and investment firm MGX. Collectively, they will hold 45% of the U.S. operation, with ByteDance retaining nearly 20%. The deal, which values TikTok U.S. at roughly $14 billion, was finalized last week and is scheduled to close on January 22, 2026. A new entity called “TikTok USDS Joint Venture LLC” will oversee operations, with Oracle acting as the trusted security partner. Notably, reports indicate that when the deal closes, the TikTok app will be discontinued in the U.S., forcing users to transition to a new, unspecified platform.
The Long Road to a Deal
This saga has been dragging on since 2020. Remember when Trump first tried to ban it or force a sale to Microsoft or Walmart? It’s been a rollercoaster of executive orders, court battles, and shifting political winds. The Biden administration kept the pressure on, signing the bill that ultimately led to this forced divestment. And here’s a wild twist: Trump himself has had a change of heart, recently filing an amicus brief arguing against an outright ban and pushing for a 50-50 ownership split. Too late, I guess. The machinery of national security concerns, once set in motion, is hard to stop. TikTok’s lawsuit against the U.S. government, claiming a First Amendment violation, is basically moot now. The deal is done.
Oracle’s Big Win and a Very Weird Future
So Oracle, which already hosts TikTok’s U.S. data on its cloud, is the big winner here. They’re not just the landlord anymore; they’re the head of security and compliance. The memo says they’ll “replicate and secure a new U.S. version of the algorithm,” which ByteDance will then lease back to the U.S. owners. Think about that. The secret sauce—the algorithm that makes TikTok, well, TikTok—will be owned by ByteDance but operated and “retrained” by Oracle on U.S. soil. ByteDance gets cut off from U.S. user data and algorithm influence. It’s a bizarre, convoluted structure designed to satisfy political demands about data sovereignty. Will it work? Who knows. But it got the deal signed.
The 2026 Shutdown and “The People’s Bid”
Here’s the thing that most users will care about: the app they know is getting the axe. According to Axios and Bloomberg, the TikTok app will be discontinued in the U.S. come 2026. Users will have to migrate to some new platform. What will that be? What features will it have? Nobody’s saying. It’s a massive, unprecedented forced migration of over 100 million users. And it wasn’t the only proposed path. A rival group called The People’s Bid for TikTok, backed by Frank McCourt’s Project Liberty, pitched a user-owned, decentralized future. They had big names like Reddit’s Alexis Ohanian and Tim Berners-Lee on board, as noted in their announcement. Even Kevin O’Leary was involved, as Project Liberty confirmed. But the Oracle consortium won. So we’re getting a corporate-controlled reboot, not a digital democracy experiment.
What This All Means
Basically, this is a political compromise dressed up as a business deal. The U.S. government gets to say it severed Chinese control. Oracle gets a huge, sticky client and a major PR win as a national security partner. ByteDance gets to cash out a huge chunk of value without fully losing its IP. But the users? They’re the lab rats in this experiment. Come 2026, will they happily flock to “TikTok USDS Joint Venture LLC’s New Video Platform”? Or will this fracture the audience and open the door for Instagram Reels or YouTube Shorts to finally eat TikTok’s lunch in America? The algorithm might be preserved, but the culture and community of an app are fragile things. You can’t just copy and paste that. This deal ends a political fight, but it starts a massive, risky consumer tech transition. Buckle up.
