Perplexity AI has put forth a new proposal to TikTok's parent company, suggesting that the U.S. government could own up to 50% of a new entity resulting from a merger between Perplexity and TikTok's U.S. business. The proposal, a revised version of an earlier plan, was submitted last week and is awaiting a response from ByteDance.
The initial proposal, presented on Jan. 18, aimed to merge Perplexity with TikTok's U.S. operations and involve investments from various parties. The updated proposal would grant the U.S. government ownership in the new structure post an IPO of at least $300 billion, without voting rights or a board seat.
ByteDance has not yet commented on the proposals. The plan would allow ByteDance to retain ties with TikTok while ensuring full U.S. board control. The proposal involves ByteDance contributing TikTok's U.S. business, excluding the proprietary algorithm, in exchange for equity in the new entity.
The proposal aligns with Treasury Secretary Steven Mnuchin's suggestion to dilute Chinese ownership in TikTok. President Trump anticipates a deal within 30 days, with interest from investors like Oracle's CEO Larry Ellison. TikTok faced a potential ban in the U.S. due to security concerns, prompting the proposed ownership restructuring.
Despite concerns over data security, no public evidence has been provided to support claims of TikTok sharing user data with Chinese authorities. The evolving situation underscores the complex interplay between technology, national security, and international business interests.
