Vladimir Korchagin, Analyst, Editor
Switzerland, 22.01.2025
Perplexity AI, known for its innovations in artificial intelligence, has made a bold and controversial proposal to merge its operations with TikTok in the U.S. Under the terms of the deal, the U.S. government could receive up to 50% of the new company’s shares after an IPO valued at $300 billion.
This move not only raises questions about national security but also sparks a broader discussion on the role of government in regulating and managing social media.
Background: TikTok and Its Chinese Roots
TikTok, owned by the Chinese company ByteDance, has been under intense scrutiny from U.S. authorities for several years. The main concern is the potential transfer of American user data to the Chinese government.
These concerns peaked in 2020, when the Trump administration attempted to ban the app in the U.S., demanding that it be sold to American companies.
Since then, ByteDance has offered several compromise solutions, including:Relocating servers to the U.S.Security oversight managed by Oracle
However, these measures proved insufficient: in early 2025, TikTok was officially banned in the U.S., setting a precedent for restricting a popular social platform.
Deal Prospects: Terms and Consequences
The proposal from Perplexity AI is an attempt to go beyond traditional solutions. The company suggests creating a new entity that combines its AI technology with TikTok’s U.S. operations, with significant government involvement. According to the IPO plan: The new entity will be valued at $300 billion.The U.S. government will receive up to 50% of shares, but without voting rights
This model addresses some key security concerns by giving the U.S. more control over the app while allowing ByteDance to retain full control over the algorithm.However, analysts point out new risks in this management structure:
- National Security: Will the U.S. government truly control TikTok if ByteDance retains the algorithm?
- Ethical Concerns: Is it appropriate for the government to own a stake in a commercial social platform?
- Economic Impact: An IPO valued at $300 billion will generate massive financial flows, but who will ultimately benefit?
Who Are Perplexity AI and ByteDance?
Perplexity AI A rapidly growing artificial intelligence company, known for its answer generation tools and big data analysis.
Its products are widely used in analytics, information retrieval, and other fields requiring high-precision AI.
The TikTok merger proposal is a chance for Perplexity AI to increase its visibility and influence significantly.
ByteDance Founded in 2012, ByteDance is one of China’s most innovative tech companies.
Its flagship product, TikTok, has over one billion users worldwide.
The TikTok algorithm, famous for its highly personalized content recommendations, is ByteDance’s key asset, which it has never agreed to hand over to another entity.
Smart Deal or New Form of Control?
The Perplexity AI proposal seems like a groundbreaking idea that could resolve long-standing disputes over TikTok. However, government involvement in social media remains a controversial issue.This could lead to political influence over technology and potentially change the nature of the platform itself.
Could this merger be a compromise between security and innovation? Or is it the first step toward chaos, where governments and corporations share control over data and users?
