Elon Musk is reportedly trying to save TikTok

Chinese officials are reportedly exploring backup plans for TikTok after the Supreme Court appeared unlikely to rescue the app from a U.S. ban. With TikTok's legal options all but exhausted, multiple news outlets are reporting that China is considering an option it has previously said it would not: letting ByteDance sell the app.

Kicker? China is reportedly considering using President-elect Donald Trump's favorite tech billionaire Elon Musk to act as a broker or buyer in the arrangement. Report from financial times, wall street journal and Bloomberg — all citing unnamed sources — suggest Chinese officials are at least discussing the option of a sale. TikTok spokesman Michael Hughes called the reports “pure fiction.” The Chinese Embassy in the United States and Musk's existing social media company X did not respond to requests for comment.

Currently, many people, from “Shark Tank” star Kevin O'Leary to YouTuber Mr. Beast, have expressed interest in buying TikTok. The problem isn’t a lack of buyers — although obvious ones like Meta and Google could be banned by antitrust agencies — but a reluctance on the part of sellers. New reports suggest the Chinese government, which has long said it would refuse to approve the sale, may now have a change of heart. Musk's involvement reportedly has some strategic significance based on his ties to China and Trump.

Musk is in a unique position to play a role in a potential deal. He has direct ties to Trump, has said since the purchase that he wanted X to be more like TikTok, and has extensive experience dealing with Chinese authorities. (Sales from China make up a large portion of Tesla's business.) He could merge TikTok with X and his OpenAI rival xAI to create a more influential platform. As the world's richest man, he also has access to the funds he needs to trade.

Long Le, professor of international business at Santa Clara University, tells us edge China may be open to joint venture arrangements, similar to what is often experienced by foreign companies operating in China. According to the US legal text, an application can be considered controlled by a foreign adversary if a person from one of the foreign adversaries owns at least 20% of the shares.

“If they were to do some type of joint venture, Elon Musk would be ideal because he is also close to Trump,” Le said, adding that the Chinese government may already be comfortable with him. “Having someone like Musk will still keep the U.S. and China connected on some aspects of trade and foreign direct investment, even though overall decoupling is happening.”

China may delay the sale if it believes the United States will let TikTok remain owned by ByteDance, especially given TikTok's global influence. ByteDance is a homegrown tech giant and a source of national pride in China, so the government may not be willing to bear the consequences of handing TikTok over to the United States. In addition, China may prefer to let the United States bear the pressure of the ban globally, even if it means TikTok loses an important market. Chinese Foreign Ministry spokesman Wang Wenbin said last year that forced sales or bans “will inevitably come back to bite the United States.”

China, on the other hand, will face a new protectionist government when Trump is sworn in next week. He has promised to impose exorbitant tariffs on Chinese imports that could harm its economy. If the Chinese government is looking for an effective bargaining chip with Trump and the United States, it may find one in TikTok, especially given the president-elect's “enthusiasm” for the app. Chinese officials view the TikTok deal as a possible area of ​​cooperation with the United States as they anticipate tense talks with the Trump administration on other issues, sources said Bloomberg.

If TikTok were banned, it's unclear how quickly users would feel the impact. Apple and Google need to remove the app from their app stores and stop updating it. If a user has downloaded it, it will still remain on the user's phone, but Oracle, which provides the cloud infrastructure for TikTok in the United States, may also be asked to stop hosting the app's data.

Some people can still access TikTok by using a virtual private network (VPN), but this adds additional friction. Still, progress toward reaching a deal is likely to continue after the ban comes into effect on Sunday — Unless the Supreme Court stops it, this will happen. There is also little chance that Congress or President Joe Biden will extend the deadline.