TikTok finalized a deal to keep the video-sharing platform operating in the United States, creating a new joint venture with Oracle, Silver Lake, and Emirati investment firm MGX, but questions remain about changes to the user experience and whether the arrangement addresses the security concerns that prompted the original divestiture law, according to a report by the Associated Press (AP).

Algorithm Retraining Creates Uncertainty

The algorithm powering the U.S. backend will be licensed from ByteDance and retrained on U.S. user data, TikTok said. This retraining process will result in at least subtle changes to users’ personalized feeds, according to the AP report.

“The retrained algorithm means that the trends – and what dominates feeds – will feel distinctly American,” said Kelsey Chickering, an analyst at Forrester. “Global content will still appear, but its ranking will change.”

TikTok’s press release claims U.S. creators will remain discoverable in other regions worldwide and businesses will maintain global reach, but how interoperability between the U.S. and ByteDance will function remains unknown.

“This matters because the algorithm is the heartbeat of the app’s addictive experience,” Chickering said. “The question becomes: Will a U.S.-centric feed supercharge engagement, or will it chip away at TikTok’s cultural cachet?”

Any noticeable changes to a social media platform’s service raise the risk of alienating its audience, said Jasmine Enberg, a former analyst at eMarketer and founder of Scalable.

Security Concerns Persist

Lawmakers previously expressed concern that the Chinese government could use TikTok’s algorithm to push propaganda or gather data on individual users, prompting Congress to pass legislation in 2024 requiring divestment from Beijing-based ByteDance.

The law prohibits “any cooperation with respect to the operation of a content recommendation algorithm” between ByteDance and a new American ownership group. How ByteDance’s continued involvement, specifically licensing the algorithm to the U.S. entity, aligns with this restriction remains unclear, according to the AP report.

Business Impact and Creator Response

Skip Chapman, co-owner of KAFX Body in Manasquan, New Jersey, which makes natural deodorants, said 80% of his sales come from TikTok Shop and the platform remains his primary customer acquisition channel. He launched his business on TikTok in April 2023 during the shop feature’s beta testing.

Chapman said he is cautiously optimistic, but concerned the new owners might de-prioritize e-commerce. “The past two years, TikTok has really leaned into this live social commerce and just the ability to sell on the platform, and they’ve kind of prioritized it, and I’m hoping that the new owners continue to prioritize it,” he said.

Vanessa Barreat, who owns La Vecindad Mexican restaurant in Las Vegas with over 100,000 TikTok followers, said visibility on the platform helped her attract customers and reduce marketing costs. “Any time there’s a major shift or deal, there’s uncertainty, but I’m not operating from fear,” she said.

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