Washington, DC – Perplexity AI has put forward a new proposal to TikTok’s parent company, suggesting that the U.S. government could have up to 50% ownership of a new entity formed from the merger of Perplexity and TikTok’s U.S. business. This proposal, submitted recently, is an updated version of a previous plan presented to ByteDance on January 18, just before the TikTok ban took effect.

The original proposal aimed to combine Perplexity with TikTok’s U.S. operations, attracting investments from various sources. However, the revised proposal now includes the provision for the U.S. government to own up to half of the new structure post an IPO of at least $300 billion, although without voting power or a board seat.

ByteDance and TikTok have not yet responded to requests for comments on the proposal. The plan would allow ByteDance to retain some ties with TikTok, although it would require “full U.S. board control.”

In the proposed arrangement, ByteDance would transfer TikTok’s U.S. business without the algorithm that powers the app’s content recommendations, as per a document reviewed by the Associated Press. This proposal aligns with suggestions made by Steven Mnuchin, former treasury secretary, on how new investment could dilute Chinese ownership of TikTok to comply with regulations.

Several investors have shown interest in TikTok, with President Donald Trump anticipating a deal within 30 days. However, during a flight on Air Force One, Trump clarified that he had not discussed a deal with Larry Ellison, CEO of Oracle, despite reports of Oracle’s potential involvement in taking over TikTok’s global operations.

Following a bipartisan law passed last year, TikTok faced a ban deadline on January 19 unless it severed ties with ByteDance. Despite legal challenges, Trump’s executive order delayed enforcement for 75 days, allowing negotiations to continue.

TikTok briefly halted its U.S. operations a week ago amid uncertainty, but resumed following Trump’s announcement of a postponement. Concerns over TikTok’s ownership structure, particularly in relation to data security and Chinese influence, fueled the push for the app’s ban in the U.S. However, as of now, there is no public evidence of TikTok sharing user data with Chinese authorities or compromising its algorithm.

In summary, the evolving saga surrounding TikTok’s future ownership and operations reflects broader geopolitical tensions and concerns over data security and cross-border technology transfers. The negotiations between Perplexity AI, ByteDance, and potential investors underscore the complex interplay between national interests, corporate strategies, and regulatory frameworks in the tech industry.