When President Donald Trump first brought up banning TikTok due to perceived national security concerns more than five years ago, the app from Beijing-based ByteDance Ltd. was the envy of the global tech industry.
Its powerful algorithm reinvented a tired social media landscape by keeping users engaged not just via posts from their friends, but by endlessly recommending content based on how they interacted with clips they came across.
Beijing drew a red line, saying there was no way they were giving up their crown jewel of the consumer tech industry. Chinese officials accused Washington of trying to plunder their private companies and even updated export laws to prohibit a sale of the secret-sauce algorithm.
That uncompromising stance now appears to have softened, at least on the surface. While Trump has hailed an accord that ostensibly saves TikTok's US operations, and values it at $14 billion, Beijing has revealed almost nothing about what was agreed. But state-backed media has repeatedly described it as a "win-win" in readouts of the negotiations. The details of the purported deal have raised more questions than answers on both sides of the Pacific. The biggest one that Americans should be asking is: What did Trump give up to save TikTok?
It's possible that China could still pull the rug out from under a deal or that the terms won't pass muster in Washington. It doesn't always appear that the two sides are on the same page. Beijing has yet to publicly confirm whether it has given its approval, despite Trump signing an executive order Thursday to advance plans for American investors to buy the US operations. But the time is ripe for Xi to concede TikTok. A law was passed with bipartisan support to ban the app or force a divestiture during the Biden administration, and TikTok has exhausted its legal battle to remain in the US.
More than half a decade since this all began, Washington and Beijing are now locked in a battle over tariffs, rare earth magnets and advanced semiconductors. Those lines of code powering TikTok have become one of the biggest sticking points in stabilizing a deteriorating relationship between the two superpowers. With deflationary pressures at home and broader macroeconomic uncertainty, Xi has bigger worries.
Trump, meanwhile, campaigned on saving the app, and has credited it with making him a "star" and reaching younger voters. TikTok doesn't even operate in China, and it's become very clear over the years that it means much more to Trump than it does to Xi. This has only given Beijing more leverage. Now is the time to use it.
Xinhua reports that a framework for a consensus was reached that also aims to resolve other issues, such as reducing investment barriers and promoting economic and trade cooperation. That suggests that something was offered up in exchange for allowing TikTok to continue operating in America. US Treasury Secretary Scott Bessent has said that it was the threat of allowing the app to go dark in America that ultimately sealed the deal.
Yet Trump has gone beyond the law to punt the deadline for TikTok's US shutdown four times this year alone, and when the app did briefly cease operations in the country in January, it was the president himself who took credit for its return in a message to its 170 million US users. Clearly, something else was offered to prevent Trump's favorite platform from being turned off at home after he promised to save it.
As part of the deal, Beijing is sticking to its original red line. ByteDance will reportedly still own the coveted algorithm, but will license a copy of it to a US consortium to rebuild its own version of "from the ground up," a White House official has stated. It's unclear whether this scheme will abide by the US law to ban the app, as well as ensuring that Beijing won't have even a shred of influence. After all this, China is still holding onto the algorithm. A leasing arrangement may give ByteDance a way to earn money to focus on its other priorities.
The tech landscape has also moved on over the years. The short-form video field is now crowded with copycats, from Alphabet Inc.'s YouTube Shorts to Meta Platforms' Instagram Reels. ByteDance in the US is still most well-known for being the TikTok parent company, but in China it has already shifted its focus to becoming an AI powerhouse. It's Doubao chatbot is the most popular AI app in the country by monthly active users, beating out even DeepSeek. And its latest model is the highest-ranked Chinese AI system on benchmarking platform OpenCompass' leaderboard, just behind OpenAI and ahead of Alibaba Group Holding Ltd.'s Qwen and DeepSeek.
While it was once the centerpiece of China's global tech ambitions, TikTok may now be just another tradeable asset in a larger strategy to secure dominance in key technologies of the future. Xi has held his ground so far by standing up to Trump and eking out an extended trade war truce. Now, something has to give. Allowing the White House to find a way to keep TikTok in the US is a strategic peace offering in exchange for more pressing priorities.
In his 2025 book chronicling the entanglement of Apple Inc.'s relationship with Beijing, tech journalist Patrick McGee writes: "In China, 'win-win' means China wins twice." The White House may be taking a public victory lap for keeping a version of the popular social media platform in the US, but this could prove far less valuable than what Beijing quietly walked away with.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
