The bill that will ultimately ban TikTok in the US has progressed as the House of Representatives voted to pass the legislation. ByteDance will have two options, which are to divest the app to the US or to have it completely banned. Even if the parent company opts for a sale, it might not be as easy.
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TikTok Sale Will Face Many Problems
It's now up to the Senate whether the bill will move on and be signed by US President Joe Biden, and the national leader already said that he would sign it. If all goes according to plan, ByteDance will have difficult decisions ahead.
In the scenario that TikTok would be divested, there could be a lot of problems that would arise in the situation. For one, it would be hard to find a buyer, considering that the social media platform has grown over the years and will be very expensive to acquire.
It's possible that a tech giant like Meta or Microsoft would purchase the app, but the companies would run into antitrust concerns, as per The New York Times. The option that would not face a lot of problems would be if investors teamed up and raised the money for the acquisition.
Other than the purchase itself, there's also the question of how much of TikTok would be sold. The US portion alone would cost around $50 billion, analysts say, which is already a huge amount as it is, much more if the entirety of it is sold.
Should the US business be sold separately, ByteDance will not be allowed to be affiliated with it in any way, given that the main concern that prompted the creation of the bill is the China-based company having access to US user data.
It could prove to be difficult to create a separate app, given that it will still communicate with TikTok users from other countries, all of which are still under ByteDance. It's also unclear how the algorithm would work since it will be based on the consumed content that might come from ByteDance's TikTok as well.
On the parent company's side, they could opt for making TikTok a separate company, wherein shares will be sold on the stock market. Even then, China could step in and block the sale, which just shows that problems could exist in every decision, every step of the way.
Read Also: Former Activision Blizzard CEO Bobby Kotick Interested in TikTok Acquisition Despite Looming Ban
We Already Have a Potential Buyer
As mentioned before, the app's acquisition can be done by investors teaming up to raise the money, and it looks like former Activision Blizzard CEO Bobby Kotick already had that idea in mind. Reports say that he is already looking for partners to make it happen.
According to Kotaku, the former tech executive is considering OpenAI CEO Sam Altman as a partner. It could certainly benefit the AI company, given that TikTok is a vast source of training data for OpenAI's AI models.
As for Bobby Kotick, some might argue that he would not be the best option for ownership, especially since he has been linked to many concerns during his leadership at Activision Blizzard. For instance, he was accused of ignoring the misogynistic workplace culture and failing to report them to the board.
Related: House Passes Bill That Could Ban TikTok Unless It Separates from ByteDance
