Separating TikTok From ByteDance Could Take a Year

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Last week it was revealed that Microsoft was in talks to purchase TikTok from Beijing-based ByteDance. But separating TikTok from its parent company might be more difficult than Microsoft (or the White House) expected. According to sources within the company, it could take up to a year for TikTok to separate itself from ByteDance. This is because of their shared technical resources.

A Looming Deadline

Late last week, Trump signed an executive order banning the video-sharing app in the US by September 15th. The order was a response to concerns that the Chinese-owned app could be sharing US user data with the Chinese government. But TikTok could continue, Trump’s order stipulated, if ByteDance sold American operations to a US-based company. Enter Microsoft.

Trump has given Microsoft the go-ahead to pursue an acquisition, with a September 15th deadline. But exclusive sources have told Reuters that making this deadline could be close to impossible.

Entwined Entities

While TikTok by name is not available in China, it is functionally and technically similar to Douyin, a ByteDance-owned app available there. TikTok and Douyin share several technical resources, including its server code.

The server code provides basic functionality to the apps, like data storage, algorithms for moderating and suggesting content, and the management of user profiles. In order to ensure uninterrupted TikTok service, Microsoft will likely have to depend on ByteDance’s existing code while it reviews and revises its own. It could take up to a year for Microsoft to fully replace the server code.

Furthermore, Microsoft will have to ensure that its version of TikTok is separated from the app running in other countries. The current plan is for Microsoft to operate TikTok in the US, Canada, Australia, and New Zealand. It remains to be seen how the company successfully navigates that issue. The only certain thing is that it’s too large an undertaking for Trump’s 45-day deadline.

Possible Pitfalls

There are a few ways in which this transfer could go awry. 

First, unless Trump allows Microsoft to temporarily use ByteDance’s existing server code, it will be impossible for Microsoft to provide users uninterrupted access to TikTok. Unfortunately, the Committee on Foreign Investment in the United States (CFIUS) is opposed to any ongoing reliance on Chinese code.

The second problem has to do with a core attraction of the app: the For You page. TikTok learns the interests of its users based on how they respond to content. The more a user watches and likes videos, the better the TikTok algorithm understands that user’s preferences. As a result, the user will see more of what interests them, and less of what doesn’t.

But if American TikTok operations are cut off from ByteDance’s dataset, the algorithm will be starved for data. In other words, TikTok might forget each user’s particular interests, and users will start viewing some pretty random content as the process begins anew. As Microsoft Chief Information Officer Jim DuBois said, “algorithms are not worth anything without the data.”

Looking Forward

Even before Trump’s order, ByteDance was already in the process of separating itself from TikTok. CFIUS had pressured the company for months, and both Microsoft and Twitter had shown interest in buying the app. It is noteworthy that Trump did not sign the executive order until after he met one-on-one with the CEO of Microsoft.

All of this suggests that Trump’s ban is more of a symbolic display of power than an actual hard deadline. And since Trump likely wants an American company to take possession of a popular endeavor, it wouldn’t be surprising if he moves the date to fit a more realistic timeline.


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