Donald Trump is currently in the process of closing a deal that could permanently alter TikTok and throw a major wrench into the creator economy.
With far-reaching implications on the influential platform, the administration is in the final stages of negotiating terms of a multi-billion dollar purchase that would transfer majority ownership of TikTok in the U.S. to a group of MAGA-friendly billionaires.
Under the proposed deal finally unveiled last week, Oracle’s Larry Ellison, Michael Dell, the venture capital firm Andreessen Horowitz, private equity investment group Silver Lake, and Rupert and Lachlan Murdoch’s Fox Corp, the parent company of Fox News, will be given majority ownership over the app. These new American owners would then lease a copy of TikTok’s algorithm from its parent company, ByteDance, which will reportedly be rebuilt and trained on U.S. content by the U.S. arm of the platform.
As it is structured and assuming China does sign off on the deal, data for the U.S. TikTok would be managed by Oracle but no one corporate entity would hold a majority stake. While it remains unclear how much the U.S. version would resemble the current TikTok, ByteDance would maintain a 20% interest in the new domestic-based venture.
Most importantly for Trump, who benefited from the platform during last year’s election, content moderation and the code that drives TikTok will be under the control of U.S. investors.
This whole scheme is already making influencers, many of whom rely on TikTok for a living, nervous. Since TikTok launched in the U.S. in 2018, the app has become a bedrock of the creator economy. According to a report by Oxford Economics, an economic advisory firm, TikTok contributed $24.2 billion to U.S. GDP in 2023 alone, and the app supports over 224,000 U.S.-based jobs. The influencer industry has ballooned to a $250 billion industry according to a 2023 report by Goldman Sachs, and is set to roughly double to $480 billion by 2027.
TikTok has significantly more left-leaning news content creators than other apps, according to a report by Pew Research, but under this new regime, that split might change. Already, TikTok has been cracking down on speech critical of people in power and the administration. Creators who have been critical of Israel’s ongoing assault on Gaza report having their content restricted and banned. There is concern among influencers and average users that the Trump admin will retool the algorithm to push pro-MAGA messaging on the app, which is now the preferred news source in the U..S. of around 44% of Americans under age 30 (a significant voting block for any politician or party).
V Spehar, a TikToker with over 3.7 million followers who covers news and politics, said that if Trump attempts to turn TikTok into another right wing echo chamber, she and other creators will simply quit using the app. “TikTok has been an incredible discoverability platform for me and for many other creators,” she said. But if the algorithm becomes transparently biased, “I’ll probably spend more of my time focusing on YouTube or Meta platforms or Substack. There’s no chance that I will participate in whatever this new Truth Social 2.0 thing is,” she said.
Spehar and other creators may also have a harder time reaching their audiences under the new structure of the deal, which would separate the U.S. out from the version of TikTok the rest of the world uses. Creators who have worked to cultivate global fandoms may find it harder to reach those fans, and could see a significant drop in views and income. There’s also concern that users will be exposed to less world news, cutting off Americans from the global community.
Jonathan Katz, a TikTok content creator and journalist who publishes the newsletter The Racket, covering far right extremism, said that, “it is exhausting having yet another social media space that proved to be an unexpectedly generative community get taken over by the same clique of reactionary billionaires that ruined Twitter and Substack.”
He is concerned that the pro-MAGA shift on TikTok under the new ownership structure might not happen quickly enough for people to even realize what’s going on. “It won’t happen all at once,” he said. “But, most likely, over time I’ll get slop, hate, and far-right trolls in my [TikTok] feed and less engagement with my posts.”
Eventually, every non-right-wing creator will have to make a decision, Katz said, on whether to continue to build a business on TikTok as the app becomes less globalized, more niche, and morphs into an “increasingly hostile environment.”
