Connect with us

Business

TikTok has finalized its U.S. joint venture, ending saga over its fate

Published

on

TikTok has finalized its U.S. joint venture, ending saga over its fate

The long and winding road over the fate of TikTok — the enormously popular social video platform that has been a force in American youth culture and entertainment — has come to an end.

After years of questions about TikTok’s future in America, the social media platform and its Chinese parent company, ByteDance, have finalized the app’s U.S. joint venture.

The announcement closes the chapter on a saga that began six years ago when President Trump during his first term sought to ban the platform, citing national security concerns involving ByteDance.

But Trump shifted his views on the platform after ByteDance and its affiliates agreed to divest majority ownership of U.S. operation to an American-led investor group.

The joint venture deal was established under an executive order signed by Trump in September.

Advertisement

In an announcement posted Thursday, TikTok said the U.S. joint venture now has three managing investors: Silver Lake, Oracle and Emirati investment firm MGX, each holding 15%, with ByteDance retaining 19.9% of investments.

The new firm will be headed by Adam Presser, who previously worked as TikTok’s head of operations and trust and safety. He will join a seven-member, majority-American board of directors that includes TikTok’s Chief Executive Shou Zi Chew.

In a Truth Social post, Trump thanked Chinese leader Xi Jinping “for working with us and, ultimately, approving the Deal” and said it was a “dramatic, final, and beautiful conclusion.”

“I am so happy to have helped in saving TikTok!” he wrote. “I only hope that long into the future I will be remembered by those who use and love TikTok.”

ByteDance had been under pressure to divest its ownership in the app’s U.S. operations or face a nationwide ban after Congress passed a law that went into effect a year ago.

Advertisement

“China’s position on TikTok has been consistent and clear,” Guo Jiakun, a Chinese Foreign Ministry spokesperson in Beijing, said Friday according to the Associated Press.

Under new safeguards, there will be more protections for users’ data and algorithms, as well as better content moderation and software assurances, the company said.

The new version will operate under “defined safeguards that protect national security through comprehensive data protections, algorithm security, content moderation, and software assurances for U.S. users,” the company said in its statement Thursday.

These protections will be secured by Oracle’s cloud environment. The tech company’s Executive Chairman Larry Ellison has also been making headlines for attempting to purchase Warner Bros. Discovery through Paramount.

Ramesh Srinivasan, professor of information studies at UCLA, said he finds the deal to be “deeply concerning.” He said TikTok will become more similar to American-owned social media applications when it comes to access to data and how it’s monetized.

Advertisement

“But at the same time, the data is going to be captured by folks like Mr. Ellison, who is very close to the president,” said Srinivasan. “That raises major concerns about the incredibly close affinity the president has with these tech oligarchs. This means TikTok will increasingly serve the dictates of this administration.”

Srinivasan also raises concerns that this deal could influence what people can see on their algorithms, especially when it comes to global news.

He added, “Our younger people may end up getting manipulated without any disclosure or knowledge.”

According to TikTok, there are over 200 million U.S. users and 7.5 million businesses that use the platform.

The news, announced last month, comes as a relief to many U.S.-based influencers, many of whom operate in Southern California, who rely on the social media platform for their livelihoods. The same day the news of the joint venture broke, TikTok hosted its inaugural TikTok Awards at the Hollywood Palladium. Keith Lee, a food reviewer with over 17 million followers, celebrated the announcement among other attendees.

Advertisement

“[TikTok] is the best way to reach people and I know so many people who rely on it to support their families,” said Lee, in an interview with The Times. “For me, it’s my career now so I can’t imagine it not being around.”

The app is largely responsible for reshaping the way young Americans shop and consume entertainment. One example of that can be found in the TikTok Shop platform where small businesses and brands sell their products directly to consumers and engage influencers to help with promotion. In many ways, the platform can resemble Gen Z’s version of QVC.

The app’s roots date back to 2014, when Musical.ly, an app of a similar nature was launched in Shanghai. In 2016, Chinese tech company ByteDance launched a similar platform in China called Douyin. As the apps grew in popularity separately, ByteDance picked up on its potential, purchased Musical.ly in 2017 and combined all these platforms into one, named TikTok. Over the next few years, the app began its rapid ascent , hooking in users with a curated algorithm and viral trends.

The deal removes a shadow that was cast over the future of TikTok, which has become one of the world’s most dominant social media platforms and has a large presence in Culver City. The company’s business in the U.S. had been uncertain for many years amid legislators’ security concerns about ByteDance’s ties to China.

Trump allowed TikTok to keep operating in the country and in September signed the executive order outlining the new joint venture.

Advertisement

Business

MrBeast company sued over claims of sexual harassment, firing a new mom

Published

on

MrBeast company sued over claims of sexual harassment, firing a new mom

A former female staffer who worked for Beast Industries, the media venture behind the popular YouTube channel MrBeast, is suing the company, alleging she was sexually harassed and fired shortly after she returned from maternity leave.

The employee, Lorrayne Mavromatis, a Brazilian-born social media professional, alleges in a lawsuit she was subjected to sexual harassment by the company’s management and demoted after she complained about her treatment. She said she was urged to join a conference call while in labor and expected to work during her maternity leave in violation of the Family and Medical Leave Act, according to the federal complaint filed Wednesday in the U.S. District Court for the Eastern District of North Carolina.

“This clout-chasing complaint is built on deliberate misrepresentations and categorically false statements, and we have the receipts to prove it. There is extensive evidence — including Slack and WhatsApp messages, company documents, and witness testimony — that unequivocally refutes her claims. We will not submit to opportunistic lawyers looking to manufacture a payday from us,” Gaude Paez, a Beast Industries spokesperson, said in a statement.

Jimmy Donaldson, 27, began MrBeast as a teen gaming channel that soon exploded into a media company worth an estimated $5 billion, with 500 employees and 450 million subscribers who watch its games, stunts and giveaways.

Mavromatis, who was hired in 2022 as its head of Instagram, described a pervasive climate of discrimination and harassment, according to the lawsuit.

Advertisement

In her complaint, she alleges the company’s former CEO James Warren made her meet him at his home for one-on-one meetings while he commented on her looks and dismissed her complaints about a male client’s unwanted advances, telling her “she should be honored that the client was hitting on her.”

When Mavromatis asked Warren why MrBeast, Donaldson, would not work with her, she was told that “she is a beautiful woman and her appearance had a certain sexual effect on Jimmy,” and, “Let’s just say that when you’re around and he goes to the restroom, he’s not actually using the restroom.”

Paez refuted the claim.

“That’s ridiculous. This is an allegation fabricated for the sole purpose of sparking headlines,” Paez said.

Mavromatis said she endured a slate of other indignities such as being told by Donaldson that she “would only participate in her video shoot if she brought him a beer.”

Advertisement

“In this male-centric workplace, Plaintiff, one of the few women in a high-level role, was excluded from otherwise all-male meetings, demeaned in front of colleagues, harassed, and suffered from males be given preferential treatment in employment decisions,” states the complaint.

When Mavromatis raised a question during a staff meeting with her team, she said a male colleague told her to “shut up” or “stop talking.”

At MrBeast headquarters in Greenville, N.C., she said male executives mocked female contestants participating in BeastGames, “who complained they did not have access to feminine hygiene products and clean underwear while participating in the show.”

In November 2023, Mavromatis formally complained about “the sexually inappropriate encounters and harassment, and demeaning and hostile work environment she and other female employees had been living and experiencing working at MrBeast,” to the company’s then head of human resources, Sue Parisher, who is also Donaldson’s mother, according to the suit.

In her complaint, Mavromatis said Beast Industries did not have a method or process for employees to report such issues either anonymously or to a third party, rather employees were expected to follow the company’s handbook, “How to Succeed In MrBeast Production.”

Advertisement

In it, employees were instructed that, “It’s okay for the boys to be childish,” “if talent wants to draw a dick on the white board in the video or do something stupid, let them” and “No does not mean no,” according to the complaint.

Mavromatis alleges that she was demoted and then fired.

Paez said that Mavromatis’s role was eliminated as part of a reorganization of an underperforming group within Beast Industries and that she was made aware of this.

Advertisement
Continue Reading

Business

Heidi O’Neill, Formerly of Nike, Will Be New Lululemon’s New CEO

Published

on

Heidi O’Neill, Formerly of Nike, Will Be New Lululemon’s New CEO

Lululemon, the yoga pants and athletic clothing company, has hired a former executive from a rival, Nike, as its new chief executive.

Heidi O’Neill, who spent more than 25 years at Nike, will take the reins and join Lululemon’s board of directors on Sept. 8, the company announced on Wednesday.

The leadership change is happening during a tumultuous time for Lululemon, which had grown to $11 billion in revenue by persuading shoppers to ditch their jeans and slacks for stretchy leggings. But lately, sales have declined in North America amid intense competition and shifting fashion trends, with consumers favoring looser styles rather than the form-fitting silhouettes for which Lululemon is best known.

“As I step into the C.E.O. role in September, my job will be to build on that foundation — to accelerate product breakthroughs, deepen the brand’s cultural relevance, and unlock growth in markets around the world,” Ms. O’Neill, 61, said in a statement.

Lululemon, based in Vancouver, British Columbia, has also been entangled in a corporate power struggle over the company’s future. Its billionaire founder, Chip Wilson, has feuded with the board, nominated independent directors and criticized executives.

Advertisement

Lululemon’s previous chief executive, Calvin McDonald, stepped down at the end of January as pressure mounted from Mr. Wilson and some investors. One activist investor, Elliott Investment Management, had pushed its own chief executive candidate, who was not selected.

The interim co-chiefs, Meghan Frank and André Maestrini, will lead the company until Ms. O’Neill’s arrival, when they are expected to return to other senior roles. The pair had outlined a plan to revive sales at Lululemon, promising to invest in stores, save more money and speed up product development.

“We start the year with a real plan, with real strategies,” Mr. Maestrini said in an interview this year. “We make sure decisions are made fast.”

Lululemon said last month that it would add Chip Bergh, the former chief executive of Levi Strauss, to its board to replace David Mussafer, the chairman of the private equity firm Advent International, whom Mr. Wilson had sought to remove.

Ms. O’Neill climbed the organizational chart at Nike for decades, working across divisions including consumer sports, product innovation and brand marketing, and was most recently its president of consumer, product and brand. She left Nike last year amid a shake-up of senior management that led to the elimination of her role.

Advertisement

Analysts said Ms. O’Neill would be expected to find ways to energize Lululemon’s business and reset the company’s culture in order to improve performance.

“O’Neill is her own person who will come with an agenda of change,” said Neil Saunders, the managing director of GlobalData, a data analytics and consulting company. “The task ahead is a significant one, but it can be undertaken from a position of relative stability.”

Continue Reading

Business

Angry Altadena residents ask officials to halt Edison’s undergrounding work

Published

on

Angry Altadena residents ask officials to halt Edison’s undergrounding work

Eaton wildfire survivors’ anger about Southern California Edison’s burying of electric wires in Altadena boiled over Tuesday with residents calling on government officials to temporarily halt the work.

In a letter to the Los Angeles County Board of Supervisors, more than 120 Altadena residents and the town’s council wrote that they had witnessed “manifest failures” by Edison in recent months as it has been tearing up streets and digging trenches to bury the wires.

The residents cited the unexpected financial cost of the work to homeowners and possible harm to the town’s remaining trees. They also pointed out how the work will leave telecommunication wires above ground on poles.

“The current lack of coordination is compounding the stress of a community still reeling from the Eaton Fire, and risks causing further irreparable harm,” the residents wrote.

Advertisement

The council voted unanimously Tuesday night to send the letter.

Scott Johnson, an Edison spokesman, said Wednesday that the company has been working to address the concerns, including by looking for other sources of funds to help pay for the homeowners’ costs.

“We recognize this community has already faced a number of challenges,” he said.

Johnson said the company will allow homeowners to keep existing overhead lines connecting their homes to the grid if they are worried about the cost.

Edison’s crews, Johnson said, have also been trained to use equipment that avoids roots and preserves the health of trees.

Advertisement

The utility has said that burying the wires as the town rebuilds thousands of homes destroyed in the fire will make the electrical grid safer and more reliable.

But anger has grown as work crews have shown up unexpectedly and residents learned they’re on the hook to pay tens of thousands of dollars to connect their homes to the buried lines.

Residents have also found the crews digging under the town’s oak and pine trees that survived last year’s fire. Arborists say the trenches could destroy the roots of some of the last remaining trees and kill them.

Amy Bodek, the county’s regional planning director, recently warned Edison that a government ordinance protects oak trees and that “utility trenching is not exempt from these requirements.”

Residents have also pointed out that in much of Altadena, the telecom companies, including Spectrum and AT&T, have not agreed to bury their wires in Edison’s trenches. That means the telecom wires will remain on poles above ground, which residents say is visually unappealing.

Advertisement

“While our community supports the long-term benefits of moving utilities underground, the current execution by SCE is placing undue financial and planning burdens on homeowners, causing irreparable harm to our heritage tree canopy, and proceeding without adequate local oversight,” the residents wrote.

They want the project halted until the problems are addressed.

Edison announced last year that it would spend as much as $925 million to underground and rebuild its grid in Altadena and Malibu, where the Palisades fire caused devastation.

The work — which costs an estimated $4 million per mile — will earn the utility millions of dollars in profits as its electric customers pay for it over the next decades.

Pedro Pizarro, chief executive of Edison International, told Gov. Gavin Newsom last year that state utility rules would require Altadena and Malibu homeowners to pay to underground the electric wire from their property line to the panel on their house. Pizarro estimated it would cost $8,000 to $10,000 for each home.

Advertisement

But some residents, who need to dig long trenches, say it will cost them much more.

“We are rebuilding and with the insurance shortfall, our finances are stretched already,” Marilyn Chong, an Altadena resident, wrote in a comment attached to the letter. “Incurring the additional burden of financing SCE’s infrastructure is not something we can or should have to do.”

Other fire survivors complained of Edison’s lack of planning and coordination with residents.

“I’ve started rebuilding, and apparently there won’t be underground power lines for me to connect with in time when my house will be done,” wrote Gail Murphy. “So apparently I’m supposed to be using a generator, and for how long!?”

Johnson said the company has set up a phone line for people with concerns or questions. That line — 1-800-250-7339 — is answered Monday through Saturday, he said.

Advertisement

Residents can also go to Edison’s office in Altadena at 2680 Fair Oaks Avenue. The office is open Monday to Friday from 8 to 4:30.

It’s unclear if the Eaton fire would have been less disastrous if Altadena’s neighborhood power lines had been buried.

The blaze ignited under Edison’s towering transmission lines that run through Eaton Canyon. Those lines carry bulk power through the company’s territory. In Altadena, Edison is burying the smaller distribution lines, which carry power to homes.

The government investigation into the cause of the fire has not yet been released. Pizarro has said that a leading theory is that a century-old transmission line, which had not carried power for 50 years, somehow re-energized to spark the blaze.

The fire killed at least 19 people and destroyed more than 9,400 homes and other structures.

Advertisement
Continue Reading
Advertisement

Trending