Context
Back in 2020, President Donald Trump announced the plans to ban TikTok in the United States. At the same time, the justification was national security concerns over the potential access of data by the Chinese government through TikTok’s parent company, ByteDance. The ban was never materialized, but it marked the first moment when a social media app became the center of a geographical standoff. Fast forward to today, with Trump now back in power, he is once again pushing for a “solution”. This time, according to CNN News, the proposed deal with Chinese President Xi is that the majority of the shares would be transferred to the American investors, like Oracle, while ByteDance would only retain a minority stake. The arrangement is meant to resolve concerns without killing the app that has 139 million active American users (Castmagic, 2025)
But, as U.S. Treasury Secretary Scott Bessent revealed this week, China was clearly not in favor of the “deal” and resisted giving up control of such a valuable platform. According to Bessent:
“What turned the tide was a call that Ambassador Jamieson Greer and I had with President Trump the night after the first day of negotiations, and President Trump made it clear that he would be willing to let TikTok go dark,” Bessent told CNBC on Tuesday.
In other words, the threat of a complete shutdown forced China back to the table and created a path for the current ownership deal, which is going to be announced in the coming weeks.
Comparison with TikTok vs. Kwai
This global drama reminds me of the case we studied in class about Douyin (Chinese TikTok) versus Kuaishou (Kwai) in China. Both platforms benefited from strong network effects: more content creators attracting more viewers, which attracted even more creators, reinforcing a positive feedback loop. But the competition also showed how differentiation matters. TikTok is relying on its recommendation algorithm and global expansion, while Kwai has built more community-driven interactions and is turning its focus to lower-tier Chinese regions. That rivalry was shaped by market forces and strategy. In the U.S., TikTok’s rivalry is not with another substitute app, instead, it is with the government itself. Here, geopolitics has become the real “competitor” reshaping the platform’s future.
Further Discussion
My personal opinion regarding this geopolitical tension between China and US is balanced. While the new deal may reduce the immediate tensions, it does not fully solve the deeper issue below the surface. The algorithm that drives TikTok’s content is still developing in China and liscensed out, which means concerns about influence and data insecurity won’t simply vanish in America or any parts of the world. Meanwhile, splitting ownership or separating TikTok and Douyin could reduce TikTok’s innovation cycle since ByteDance is no longer involved or barely involved, this could give more rooms for rivals to grow and expand.
What I found most intriguing is whether this U.S.-China split will create a two-parallel TikTok and Douyin world, similar to how TikTok and Kwai co-exist in China. Could the US-owned TikTok evolve differently from Douyin in China, with separate features, rules, and communities? Or will this separation weaken TikTok’s vision, strategies, reputation, network effects, and so on until the point where potential competitors (e.g. RedNotes) finally catch up and replace it?
References
Castmagic. (2025). TikTok Users by Country in 2025: Global Stats & Rankings. Castmagic.io. https://www.castmagic.io/post/tiktok-usage-by-country#which-country-has-the-most-tiktok-users
Treene, A., & Goldman, D. (2025, September 16). We now know who the new owners of TikTok will be – if Trump gets his deal done with Xi. CNN. https://edition.cnn.com/2025/09/16/tech/tiktok-ban-extension-trump
Imran Rahman-Jones. (2025b, September 16). TikTok to stay in the US as Donald Trump says deal is done. BBC. http://www.bbc.com/news/articles/c7847q9xvwgo
