Elon Musk may acquire TikTok's U.S. operations amid government negotiations

The Chinese government, after previously opposing the sale of TikTok to prevent a U.S. ban, may now have found an acceptable buyer: Elon Musk. According to reports from Bloomberg and The Wall Street Journal , Chinese officials are considering selling part of TikTok’s U.S. operations to Musk’s company, X. CNN has not independently verified these reports. This potential move represents a major shift just days before a U.S. law that could ban TikTok is set to take effect. The law allows ByteDance, TikTok’s parent company, to sell its U.S. assets to avoid the ban. Last week, the Supreme Court signaled it would uphold the law, citing national security concerns, despite TikTok’s claims that the legislation violates free speech protections. Although ByteDance and Chinese officials have previously opposed forced sales, this new option appears to be under discussion. Neither ByteDance nor Musk has commented on the reports, and TikTok spokesperson Michael Hughes dismissed the claims as “pure fiction.” Nevertheless, a deal could serve the interests of all parties involved. ByteDance might prefer to sell TikTok’s U.S. operations rather than lose access to the American market altogether. For China, Musk’s strong business ties in the country and his influence with incoming U.S. President Trump could make him an appealing buyer. For Musk, acquiring TikTok would expand his social media presence, reinforce his narrative as a defender of free speech, and provide valuable data for ventures like X and xAI. James Andrew Lewis from the Center for Strategic and International Studies suggested that the rumors might be a test to gauge public reaction. However, significant hurdles remain, including the financing of the deal, which analysts estimate could cost $40–$50 billion. While Musk is among the richest people in the world, much of his wealth is tied to Tesla shares, and his purchase of X left him with considerable financial challenges. Securing support from banks for another high-stakes acquisition could be difficult. Additionally, TikTok’s algorithm—considered its “core technology”—might be subject to Chinese export restrictions, complicating any potential sale. Still, Musk’s extensive business dealings in China, where Tesla earned $5.7 billion in revenue in Q3 2024 and operates its Shanghai Gigafactory, strengthen his relationship with Chinese officials. China could also use a TikTok sale as leverage in trade negotiations with Trump’s administration, particularly as Musk’s close ties to Trump could expedite the process. Trump could then claim credit for saving TikTok for American users. Despite the potential benefits, an acquisition by Musk could face significant user backlash. Many TikTok users fear Musk’s ownership would lead to changes similar to those on X, where content moderation was loosened, banned accounts were reinstated, and misinformation increased. Some users have expressed a preference for TikTok being banned rather than sold to Musk, citing concerns over quality and safety under his management. While a TikTok acquisition by Musk could create opportunities for his business ventures, it also presents challenges. User dissatisfaction and financing hurdles could ultimately undermine the platform’s value under his ownership.