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TikTok owners say they have no plans to sell their US business and 'would rather close'

TikTok owners say they have no plans to sell their US business and 'would rather close'

TikTok's parent company, ByteDance, would reportedly prefer to shut down the app completely rather than offload its business after the US passed a new law forcing it to sell the platform or ban it in the country.

“ByteDance has no plans to sell TikTok,” ByteDance said on the Toutiao social media platform it owns.

Reuters reported, citing anonymous sources, that ByteDance would rather shut down the app than sell it if it exhausts all legal options to fight the ban in the United States.

After US President Joe Biden signed the Senate-passed bill into law, reports emerged suggesting that TikTok's parent company could sell its operations to a US-based company, but without the algorithm that recommends videos on the app.

ByteDance considers TikTok's algorithm the core of its overall operations, including other domestic video sharing platforms in China.

TikTok has nine months to sell or face a ban

The app was launched in 2017 and quickly became one of the most popular social media platforms in the world, with success widely attributed to its unique algorithm, which is considered better than those of its competitors such as Tencent.

Its algorithms have been so successful that competing social media platforms like Instagram and X — formerly Twitter — have modified their designs to incorporate similar features.

The app is unlikely to be sold in the US alongside its secret recipe since its intellectual property license, including its algorithm, is registered under ByteDance in China.

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China previously indicated that it would reject a forced divestiture of TikTok during a US Congressional hearing.

“China will strongly oppose this… The sale or liquidation of TikTok involves the export of technology and must go through administrative licensing procedures in accordance with Chinese laws and regulations,” a Commerce Ministry spokeswoman said at a news conference in Beijing last year. .

Separating the app's algorithms from its US origins would also be very complex and ByteDance is unlikely to consider this option, sources told Reuters.

The law signed by Biden sets a January 19 deadline for the sale of ByteDance, but the deadline could be extended if the company is shown to be making progress toward a sale.

The Senate passed the bill amid concerns among US lawmakers that China might analyze app user data to conduct surveillance on US citizens.

The video-sharing app makes up only a small share of ByteDance's total revenue, meaning the Chinese-owned parent company would be in a position to simply shut it down in the United States in a worst-case scenario rather than sell it, Reuters reported.

“Rest assured — we’re not going anywhere,” TikTok chief Xu Ziqiu said in a video moments after Biden signed the bill.

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