The Trump administration’s aggressive pursuit of a divestiture or ban of the popular social media application TikTok in 2020 sparked a complex geopolitical and corporate drama, raising questions about national security, digital sovereignty, and the influence of political relationships on high-stakes business dealings.
At the heart of the controversy was TikTok’s parent company, ByteDance, a Chinese technology firm. U.S. officials expressed concerns that the data of American users could be accessed by the Chinese government, posing a national security risk. These concerns culminated in executive orders issued by President Donald Trump in August 2020, which aimed to ban TikTok and WeChat from operating in the United States unless their U.S. operations were sold to an American company.
The administration’s stance was unequivocal regarding the perceived threat. “We are committed to protecting the American people from all cyber threats and that includes their private data,” then-Secretary of State Mike Pompeo stated at the time. “The Chinese Communist Party is watching what you’re doing, buying, using, and selling. We want to make sure that we protect that.”
Initially, technology giant Microsoft expressed interest in acquiring TikTok’s U.S. operations. However, those discussions ultimately stalled, paving the way for a surprising new contender: Oracle, a U.S. software company with strong ties to the Trump administration. Larry Ellison, Oracle’s co-founder and chairman, was a vocal supporter of President Trump, and his company quickly emerged as a frontrunner for the deal, partnering with retail giant Walmart.
The proposed deal was not a straightforward sale but rather a complex arrangement where Oracle would become a “trusted technology partner” responsible for TikTok’s U.S. data, with Walmart also taking a stake. President Trump publicly endorsed the Oracle-Walmart proposal, stating in September 2020:
“I have given the deal my blessing. I approve the deal in concept. If they get it done, that’s great. If they don’t, that’s okay too.”
This endorsement came amid criticism that the administration’s actions might be influenced by political allegiances rather than purely national security interests. While proponents of the deal highlighted the creation of a new U.S.-based company, TikTok Global, and the promise of U.S. jobs, skeptics questioned whether the arrangement truly addressed the underlying data security concerns, given ByteDance’s continued majority ownership in the proposed structure.
The planned deal faced immediate legal challenges. ByteDance filed suit against the U.S. government, arguing that the executive orders were unconstitutional and exceeded presidential authority. Multiple federal judges issued preliminary injunctions against the ban, citing First Amendment concerns and the likelihood that TikTok would succeed on the merits of its case.
As the legal battles unfolded and the deadlines set by the executive orders passed, a definitive agreement for TikTok’s U.S. operations never fully materialized under the Trump administration. The complexities of the proposed partnership, coupled with ongoing litigation and regulatory hurdles in both the U.S. and China, prevented its finalization before President Trump left office in January 2021.
The subsequent Biden administration rescinded Trump’s executive orders related to TikTok and WeChat in June 2021, but it simultaneously launched a broader review of foreign-owned applications that pose potential national security risks, signaling an ongoing concern about data security from apps linked to adversary nations, albeit with a different approach.
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