Billionaire McCourt Plans to Restructure TikTok with $20 Billion Bid

American billionaire businessman Frank McCourt plans to significantly restructure the business model of the China-based short-form video application TikTok. Once the owner of the Los Angeles Dodgers baseball team, McCourt has received a total of $20 billion in verbal commitments from an investor consortium. The aim is to free TikTok from the legal uncertainty it faces while awaiting a Supreme Court decision that will determine whether it will have to sell its U.S. operations.

McCourt's vision for TikTok includes transforming the company's advertising model. Users will have control over the ads they see and the type of content they wish to view. In the long term, TikTok could generate revenue through data licensing for e-commerce and artificial intelligence training models, conditional on user consent. This would reduce the company's dependency on advertising.

This week, McCourt stated, "When you allow the use of your data and get compensated in return, it turns the situation 180 degrees and empowers the user."

However, the plan faces several challenges, including repeated statements asserting that TikTok cannot separate from its Chinese parent company, ByteDance. McCourt's bid for TikTok aims to simplify matters for ByteDance by excluding the algorithms that determine the content users see. In 2020, the Chinese government added content recommendation algorithms to its export control list, meaning TikTok's algorithm would have to go through administrative licensing procedures for disposal or sale.

TikTok's application to the Supreme Court is a last resort to overturn a law signed by U.S. President Joe Biden. This law aims to force a sale or otherwise ban the app on January 19 due to national security concerns. McCourt believes that the Supreme Court will uphold the law and potentially make ByteDance open to negotiations. In the meantime, he is focused on laying the groundwork for a purchase.

McCourt and his team have had "preliminary discussions" with the incoming administration of President Donald Trump. Trump had tried to ban TikTok in 2020, but on December 16 he changed his stance and expressed his affection for the app. Trump’s spokesperson did not respond to requests for comments.

McCourt also revealed that his team is in discussions with potential CEO candidates for the new TikTok.