The rumour mill is spinning, and this time, it’s Elon Musk in the spotlight—again. Reports suggest the tech mogul might be eyeing TikTok’s US operations, with Chinese officials allegedly considering selling the platform to Musk as a way to avoid an outright ban in the US. TikTok, of course, has dismissed the claims as baseless, calling them “pure fiction”, but the prospect of Musk entering the mix has already set tongues wagging.
The context behind the controversy
TikTok, owned by Chinese company ByteDance, has been at the centre of a geopolitical tug-of-war. The US government has raised concerns over national security, alleging that TikTok could funnel user data to the Chinese government or be used as a propaganda tool. With over 170 million users in the US alone, banning TikTok—set to take effect on Sunday—would leave a massive void in the social media landscape unless ByteDance agrees to sell its American operations.
ByteDance has appealed the ban to the US Supreme Court, but analysts believe a sale might be its only viable option. Enter Elon Musk, the self-styled disruptor of industries, who has reportedly been floated as a potential buyer according to Bloomberg and the Wall Street Journal.
A strategic fit for Musk’s empire?
If Musk does make a move on TikTok, it could be a savvy addition to his growing social media portfolio. After buying Twitter (now X) in 2022 for a whopping $44 billion, Musk has made it clear he wants to redefine social media. TikTok’s dominance in short-form video could perfectly complement X’s broader vision of a content and communications hub.
Wedbush analyst Dan Ives estimates TikTok’s US operations could sell for $40 billion to $50 billion, putting it in the same league as Musk’s X acquisition. Ives also points out Musk’s strong business ties to China through Tesla, which generates 23% of its quarterly revenue from the country. Those relationships could be a critical factor in navigating the high-stakes negotiations.
What this means for the industry
A Musk-led TikTok would undoubtedly shake up the social media industry. TikTok’s addictive algorithm and immense popularity make it a crown jewel for any tech giant. For Musk, this acquisition wouldn’t just bolster his influence in the sector; it would place him at the forefront of how millions of users consume and create content every day.
But not everyone is thrilled about the idea. Critics have already flagged Musk’s tendency to monopolise industries and his cosy relationship with incoming US President Donald Trump, who recently appointed Musk as co-chair of the new Department of Government Efficiency. While TikTok has denied the rumours, calling them speculative at best, the buzz surrounding Musk’s potential involvement isn’t going away anytime soon.
How this hits home in Australia
Down under, TikTok has its own set of challenges. In 2023, the Australian government banned the app from government-issued devices, citing concerns over data security and potential foreign interference. This aligns with similar moves by the US and Europe, reflecting a broader global scepticism about TikTok’s Chinese ownership.
For everyday Aussies, TikTok’s possible upheaval could be a game-changer. The app is a go-to platform for millions of users, from influencers and small businesses to big brands leaning into its unmatched engagement. A sale or major operational shift could force these users to rethink their strategies. Advertisers and content creators reliant on TikTok’s algorithm might have to scramble to maintain their reach.
Then there’s the question of data. Australia’s stringent privacy laws would likely come into play if Musk took the reins. Policymakers would scrutinise how Australian user data is managed under Musk’s ownership, especially given his free speech stance and preference for minimal content moderation. Could this clash with local regulations? It’s a question that may need answering sooner rather than later.