Biden set to inherit Trump’s TikTok conundrum

Trump has one day left in the White House. TikTok has a lot longer left in the app stores.
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Donald Trump has one day left in the White House. TikTok has a lot longer left in the app stores, despite still being owned by China’s ByteDance.

Why it matters: Trump’s failure to force divestiture or eviction was more than just a blunder, or source of schadenfreude for the TikTok users who bedeviled his reelection campaign’s event planners. It was part of a “talk loudly and carry a small stick” economic policy toward China that Joe Biden will inherit.

State of play: ByteDance is still engaged with CFIUS, but negotiations have been pushed to the back burner by political considerations in both the U.S. (election aftermath) and China (Jack Ma and all his situation represents).

  • Oracle and Walmart remain committed to their September 2020 deal, which was briefly lauded by Trump, but don’t really have a role in the CFIUS discussions.
  • TikTok continues to be atop or nearly atop the app stores, and has not yet removed the “interim” title from CEO Vanessa Pappas.

What now: Biden has occasionally talked tough on China, including when it comes to data security, but his specific policy prescriptions are so few as to fit into a TikTok video.

  • Will he maintain or cancel Trump’s executive orders related to ByteDance, not to mention EO’s that cover other Chinese tech companies like Alipay and WeChat? Or the blacklisting of Xiaomi. Dunno.
  • What about the corresponding Commerce Department prohibitions? Dunno.
  • Will new tariffs be proposed? Or will Biden just try to get concessions from China — including on tech issues — by offering to remove tariffs introduced in Trump’s “Phase 1” deal that never got to a second phase? Dunno.
  • Meanwhile, there is bipartisan D.C. consensus on the threats posted by Chinese companies like ByteDance (whether justified or not).

The bottom line: Biden’s decisions related to TikTok could give us the earliest window into his China strategy, including what he does about a looming Feb. 18 court deadline over Trump’s executive order. But there isn’t any trail of breadcrumbs to follow, which means things will be as unsettled tomorrow night as they are tomorrow morning.


Dan Primack

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