Perplexity AI has put forward a novel solution to the ongoing TikTok dilemma, suggesting a merger with TikTok's U.S. operations and a significant U.S. government stake. This proposal aims to address national security concerns while allowing ByteDance to retain some control over its popular platform.
Perplexity AI has proposed a unique solution to the ongoing TikTok controversy, aiming to appease both the U.S. government and ByteDance, TikTok's parent company. The proposal, submitted on January 18th, a day before the U.S. ban on TikTok went into effect, suggests the creation of a new entity that would merge San Francisco-based Perplexity with TikTok's U.S. operations. This new structure would attract investments from various parties, including the U.S. government.
Under the revised proposal, which was reportedly influenced by feedback from the Trump administration, the U.S. government could acquire up to 50% ownership in this new entity after its initial public offering reaches at least $300 billion. However, this government stake wouldn't carry voting rights or a seat on the board of directors. This arrangement would allow ByteDance to retain a partial connection with TikTok's U.S. operations without completely severing ties, a favorable outcome for its investors.Crucially, ByteDance would be required to relinquish control of TikTok's proprietary algorithm, the engine driving personalized content recommendations on the platform. In exchange, ByteDance's existing investors would receive equity in the newly formed structure. This proposal echoes a strategy previously discussed by Steven Mnuchin, former Treasury Secretary under Trump, who suggested diluting Chinese ownership in TikTok to address national security concerns. Mnuchin has also expressed interest in investing in the company, emphasizing the need to decouple TikTok's technology from China.President Trump has indicated optimism about reaching a deal within 30 days, stating that numerous substantial individuals are expressing interest in acquiring TikTok. He has also emphasized the importance of the U.S. benefiting from any agreement. Meanwhile, TikTok CEO Shou Chew was present at Trump's inauguration, alongside other tech leaders, signaling a potential shift in relations. While the U.S. Congress previously voted to ban TikTok due to concerns about its ownership structure posing a security risk, the Biden administration hasn't presented concrete evidence of TikTok sharing user data with Chinese authorities or manipulating its algorithm
Politics Business TIKTOK Bytedance Perplexity AI US Government National Security AI Tech Ban Donald Trump Larry Ellison Steven Mnuchin
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