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TikTok sale under Trump? China may allow U.S. investors to buy the app

MARY LOUISE KELLY, HOST:

TikTok is set to be banned next month under a law Congress passed earlier this year. There are a few wildcards, though, that could yet save the app. They include President-elect Trump, officials in China and a pending lawsuit. To walk us through what might happen with TikTok in the Trump administration, I'm joined by NPR tech correspondent Bobby Allyn. Hi, Bobby.

BOBBY ALLYN, BYLINE: Hey, Mary Louise.

KELLY: Just sketch out the lay of the land for TikTok. Why is its operation in the U.S. in question yet again?

ALLYN: Yeah. Well, this week, a federal court is set to decide a big TikTok case. As you mentioned, back in April, President Biden signed a law that would have TikTok banned by January 19, unless it totally cuts ties with ByteDance - that's its China-based parent company. Biden's Justice Department says the law is justified because a major social media app in America shouldn't be vulnerable to China, a foreign adversary. TikTok sued, arguing that banning the app would violate the free speech rights of some 170 million Americans who use it. But even if TikTok loses in court this week, hope is not lost for the app since Trump now supports TikTok.

KELLY: Right. Which is a reversal for Trump. Do we know why he has changed his mind?

ALLYN: We don't. Trump's transition team never responded for a request for comment on TikTok, but here are three data points, Mary Louise. First, Trump said earlier this year that banning TikTok would only benefit one company - Meta. And though it appears like they're trying to patch things up now, Trump for years has criticized Meta CEO Mark Zuckerberg over Trump's belief that Meta's Facebook hurt him in the 2020 election. The second data point is that Trump says the kids will go crazy if TikTok is banned. And finally, multiple reports have tied Trump's change of heart to an effort during Trump's campaign to court billionaire Republican donor Jeff Yass. His investment company has a large stake in ByteDance, which owns TikTok.

KELLY: OK. So let's step back and just walk me through what the possible outcomes for TikTok are under this new administration.

ALLYN: Yeah. I called up Jim Lewis to game this out. He's a former diplomat, now at the Center for Strategic and International Studies. And the first thing he pointed out to me was Trump's closest advisers and many of his cabinet picks are tough-on-China types.

JIM LEWIS: Within his administration, there's a lot of China hawks, and they're going to be reluctant to give up ground on TikTok.

ALLYN: So any deal that saves TikTok could be seen as being soft on China, and that could cause some real blowback in Trump's White House. But in Beijing, things seem to be shifting.

KELLY: Oh, OK. What's happening in China?

ALLYN: Yeah. Well, for years, China has been opposed to selling TikTok. But Lewis has been in touch with Chinese officials, and now their thinking seems to be changing. If China can get some relief from Trump's expected stiff tariffs against China, Lewis says China might actually approve the sale of the app to an American company or a group of American investors.

LEWIS: If ByteDance can stay a passive owner, if the Chinese have some sort of degree of control over the algorithm and TikTok can operate in the places it's allowed to operate now, it might be enough for them to swallow.

ALLYN: OK, lots of ifs there. But the big takeaway here, Mary Louise, is that Trump wants to save TikTok, and Chinese officials might just be warming up to the idea of selling TikTok. But first, TikTok needs to hear from a federal court in Washington this week about whether or not the ban is legal or not.

KELLY: NPR's Bobby Allyn covering all the ifs for us. Thank you so much, Bobby.

ALLYN: Thanks much.

(SOUNDBITE OF MAGGIE BJORKLUND SONG, "MISSING AT SEA") Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Bobby Allyn is a business reporter at NPR based in San Francisco. He covers technology and how Silicon Valley's largest companies are transforming how we live and reshaping society.