TikTok Unaware of Request for $ 5 Billion ‘Educational Fund’

Bytedance, the owner of TikTok, says it has not heard of a $ 5bn (£ 4bn) contribution to a new education fund requested by US President Donald Trump at a rally in North Carolina. North.

The firm released a statement on its website in Chinese.

He said he wanted to offer an “explanation for some false rumors” about his deal with Oracle and Walmart.

He also said that there were no plans to transfer ownership of the valuable algorithms that power TikTok.

Donald Trump had threatened to ban the app in the United States unless a sale was agreed with a US company in mid-September.

Eventually, an agreement was reached to create a new division, TikTok Global, in partnership with Oracle and Walmart, based in the US.

Trump said over the weekend that he had asked the companies involved to contribute the money “so that we can educate people about the true history of our country.”

TikTok said the $ 5 billion figure was “a forecast of the corporate income tax and other operational taxes that TikTok will have to pay for its business development in the coming years” and said it had not been finalized.

He added, in a statement made on social networks: “We would like to clarify that this is the first time we have heard the news about an educational fund of $ 5 billion.”

Bytedance also claimed that it would retain an 80% stake in TikTok Global.

“China has been determined to emphasize in recent months that the country still has full control of TikTok, amid nervousness at home over the possible sale of the company,” said Kerry Allen, BBC China media analyst.

“When Oracle agreed to a deal with ByteDance last week so that TikTok could remain active in the United States, Chinese media emphasized that the deal was” cooperative, “with both parties playing an equal role, rather than Oracle bailing out the giant. Chinese technological.. “

But China may still decide not to approve the deal, said Dr. Richard Windsor, founder of research firm Radio Free Mobile.

This is because, while Bytedance may retain the TikTok algorithm, it will still run on the US Oracle infrastructure.

“If one flips the deal and imagines a situation where a world-leading American piece of software would run on Chinese servers where a Chinese company had full access to it, one can begin to see why China might object, ” he said.