Washington and Beijing’s TikTok deal will hand ByteDance roughly 50% of the app’s American profits despite US shareholders owning the majority of the business, reports the Financial Times. The details of the deal, including precisely what percentage of the business ByteDance is handing over to US investors, suggest that the White House’s modest valuation of ByteDance, at $14 billion, will be offset by the larger claim on future US earnings.
ByteDance, and by extension Beijing, seems to have done quite well on the deal in terms of the company keeping a healthy profit share and a seat on the new board. But the key to the deal comes down to two things, firstly who controls the advanced algorithm that is central to TikTok’s appeal, and how much access China retains to the data gathered from the US app.