Elon Musk's TikTok takeover: Balancing US‑China tensions
For the Chinese authorities, selling TikTok to Elon Musk might mean handing the platform over to an ally whose business empire is deeply dependent on the Chinese market, while also being someone whose opinions are closely listened to by the future U.S. President Donald Trump, claims CNN columnist Clare Duffy.
"China is Tesla’s second-largest market; in the third quarter of 2024 alone, Tesla earned $5.7 (£4.7) billion in revenue from China. Tesla’s Shanghai Gigafactory, which Musk has praised as building the company’s highest quality cars, is also among the company’s most productive plants," Duffy emphasised. Moreover, Tesla plans to expand its operations in China, including building a "massive battery factory in Shanghai."
Media: China talks with Elon Musk about selling TikTok
The decision regarding the sale of TikTok will depend on the approval of the authorities in Beijing. This results from export restrictions that give the PRC authorities the ability to ban the sale of sensitive technologies, such as the algorithms used by TikTok.
Good relations between Musk and the authorities in Beijing are also indicated by his statements regarding the policies of the Middle Kingdom. As Duffy pointed out, Elon Musk did not comment on the mass detentions among Chinese dissidents, which began in 2012 when Xi Jinping came to power. Moreover, in September 2023, the billionaire referred to Taiwan as an "integral part of China." According to the CNN columnist, Musk could prove to be an excellent person for Chinese diplomacy to utilise in negotiations concerning trade relations with the USA.
According to Duffy, the motivation behind ByteDance's, the owner of TikTok, actions is the desire for profit. The company "may simply want to earn something for the US version of TikTok before it loses access to the valuable American market," the columnist believes.
The Chinese platform faces challenges in the USA
Musk's acquisition of the social media platform, which faces closure in the USA, "would play directly into the billionaire’s (often hypocritical) image of himself as a defender of free speech. It would give him control over an even larger and more influential social media platform than X, which he has already successfully used to boost his own interests, including aiding the reelection of Donald Trump," added Duffy.
According to the U.S. Supreme Court's ruling, ByteDance has until 19th January to sell its American division, when the law banning TikTok in the USA is set to take effect. The company has appealed this decision, arguing that it violates the right to free speech.
Donald Trump, who will be sworn in as President of the USA on 20th January, has also called for a delay in the implementation of the regulations, so that his new administration will have more time to work out a "political solution."
