Business
With Trump as president, can TikTok in the U.S. survive?
The fate of TikTok in the U.S. has been up in the air since 2020, when President Donald Trump moved to ban the popular video app because of national security concerns.
That set off four years of back-and-forth between the app’s Chinese owners and the U.S. government, with a possible ban scheduled to go into effect one day before Trump’s inauguration in January.
One hitch: Trump recently changed his mind, joining TikTok in June and posting on social media, “Those who want to save TikTok in America, vote for Trump.”
“We’re not doing anything with TikTok,” he said.
That has given some creators hope.
“The fact that Trump did a whole 180 and wants to wait and reassess how everything is going with TikTok — I think we’re going to be OK,” said creator Kat Vera, 34, who posts fitness and car content and has 457,000 followers on TikTok.
But there are factors that complicate the app’s position. Several legal experts and tech industry observers said the path forward for TikTok is still precarious.
“It’s just a huge mess, and it isn’t clear,” said Carl Tobias, a law professor at the University of Richmond.
In April, Biden signed a law passed by Congress that would require TikTok’s Chinese parent company, ByteDance, to divest its ownership of TikTok by Jan. 19 or face a ban in the U.S. due to security concerns about the app’s ties to China.
Biden has the option to extend ByteDance’s deadline, but some legal experts said that is unlikely. Changing the law would require approval by Congress, they said. Instead, some believe that the matter could be settled in the D.C. Circuit Court of Appeals.
TikTok and ByteDance sued the U.S. government in May, alleging that banning the app would violate 1st Amendment rights to freedom of speech and that the new law “offers no support for the idea” that TikTok’s Chinese ownership poses national security risks.
Experts said they expect that the court will make a decision next month. If the court rules in favor of TikTok and ByteDance, then the law will be declared unconstitutional and the government is unlikely to appeal under the incoming Trump administration.
But if the court rules against the app and the tech giant, they could appeal to the Supreme Court and ask to have the new law paused, said Michael Stovsky, a partner at law firm Benesch in Cleveland.
“They’re gonna probably ask the court to say, ‘Look, don’t enforce the law. Don’t require it to divest until the Supreme Court has heard the case,” Stovsky said.
Representatives for TikTok and the Trump administration did not respond to requests for comment.
In a court filing, TikTok and ByteDance said that they’ve tried to work with the U.S. government’s Committee on Foreign Investment to address security concerns since 2019.
Under the terms of a deal spelled out in a 90-page draft agreement, data collected about TikTok users in the U.S. was to be handled by U.S. tech giant Oracle. The proposed agreement also called for Oracle to inspect TikTok’s programming code for vulnerabilities and for the platform’s content to be subject to independent monitoring.
If TikTok did not comply, the draft agreement called for financial penalties and also included the possibility of suspending TikTok’s operations in the U.S. TikTok and ByteDance said it‘s unclear why the committee ultimately determined the proposed agreement was insufficient.
Meanwhile, Trump has changed his tune about TikTok, at least in part for apparently personal reasons and his animus for the app’s rivals. Earlier this year he called himself a “big star on TikTok.”
“If you get rid of TikTok, Facebook and Zuckerschmuck will double their business,” Trump wrote on Truth Social in March, referring to Mark Zuckerberg, the CEO of Facebook’s parent company, Meta. “I don’t want Facebook, who cheated in the last Election, doing better. They are a true Enemy of the People!”
Republican leaders have accused the social media site of censoring conservative viewpoints, which Facebook refuted, saying it has guidelines that “do not permit the suppression of political perspectives.”
Trump, who has 14.6 million followers on TikTok, joined the popular video app months after he met with Jeff Yass, a ByteDance investor, major Republican party donor and co-founder and managing partner of Susquehanna International Group, but Trump told CNBC they did not discuss TikTok.
People who had worked for Trump also have joined TikTok’s cause. Club for Growth, a conservative economic organization, hired former Trump aide Kellyanne Conway to advocate for TikTok in Congress, according to Politico.
But the Trump administration will have to deal with differing viewpoints within the Republican party on TikTok, with some preferring a hard line toward China.
“I think it’s going to become a chip in a much larger game involving tariffs with China, security agreements, all that, and that TikTok is going to be part of a bigger equation,” said Freddy Tran Nager, associate director of USC Annenberg’s Digital Social Media master’s program.
TikTok has a significant presence in Culver City, employing roughly 440 people there, according to city estimates. The company, which has 170 million U.S. users, has been a significant tool for promoting content by video creators, small businesses, music artists and Hollywood studios.
Earlier this year, TikTok notified the state of California that it would lay off 58 employees in Culver City in July “due to restructuring.” Positions affected included senior business analysts and global product specialists.
Many creators have already diversified into publishing their content on other platforms, so they aren’t solely reliant on TikTok. Some say the money-making opportunities are better on rival services.
Theodora Moutinho, a fitness creator and actress from Glendale, said she has learned to always adapt in the fast-changing world of social media.
The 25-year-old became a creator in 2017 and today has 4.2 million followers on Instagram, 1.3 million on TikTok and 421,000 on Snapchat. These days, she’s putting more effort into her Snapchat and Instagram accounts, while keeping an eye on newer platforms such as Bluesky.
“Ever since it was up in the air that they were going to take it off, not take it off, I kind of stopped really focusing on it,” Moutinho said of TikTok. “Because why try to grow something if it might come down?”
Times news researcher Scott Wilson contributed to this report.
In an expansion of its business of processing pharmaceuticals in Earth’s orbit, Varda Space Industries is renting a large El Segundo plant where toy manufacturer Mattel used to design Hot Wheels and Barbie dolls.
The plant in El Segundo’s aerospace corridor will be an extension of Varda Space Industries’ headquarters in a much smaller building on nearby Aviation Boulevard.
Varda will occupy a 205,443-square-foot industrial and office campus at 2031 E. Mariposa Ave., which will give it additional capacity to manufacture spacecraft at scale, the company said.
Originally built in the 1940s as an aircraft facility, the complex has a history as part of aerospace and defense industries that have long shaped the South Bay and is near a host of major defense and space contractors. It is also close to Los Angeles Air Force Base, headquarters to the Space Systems Command.
Workers test AstroForge’s Odin asteroid probe, which was lost in space after launch this year.
(Varda Space Industries)
Varda is one of a new generation of aerospace startups that have flourished in Southern California and the South Bay over the last several years, particularly in El Segundo, often with ties to SpaceX.
Elon Musk’s company, founded in 2002 in El Segundo, has revolutionized the industry with reusable rockets that have radically lowered the cost of lifting payloads into space. Though it has moved its headquarters to Texas, SpaceX retains large-scale operations in Hawthorne.
Varda co-founder and Chief Executive Will Bruey is a former SpaceX avionics engineer, and the company’s spacecraft are launched on SpaceX’s workhorse Falcon 9 rockets from Vandenberg Space Force Base in Santa Barbara County.
Varda makes automated labs that look like cylindrical desktop speakers, which it sends into orbit in capsules and satellite platforms it also builds. There, in microgravity, the miniature labs grow molecular crystals that are purer than those produced in Earth’s gravity for use in pharmaceuticals.
It has contracts with drug companies and also the military, which tests technology at hypersonic speeds as the capsules return to Earth.
Its fifth capsule was launched in November and returned to Earth in late January; its next mission is set in the coming weeks. Varda has more than 10 missions scheduled on Falcon 9s through 2028.
For the last several decades, the Mariposa Avenue property served as the research and development center for Mattel Toys. El Segundo has also long been a center for the toy industry as companies like to set up shop in the shadow of Mattel.
The Mattel facility “has always been an exceptional property with a legacy tied to aerospace innovation, and leasing to Varda Space Industries feels like a natural continuation of that story,” said Michael Woods, a partner at GPI Cos., which owns the property.
“We are proud to support a company that is genuinely pushing the boundaries of what’s possible, and are excited to watch Varda grow and thrive here in El Segundo,” Woods said.
As one of the country’s most active hubs of aerospace and defense innovation, El Segundo has seen its industrial property vacancy fall to 3.4% on demand from space companies, government contractors and technology startups, real estate brokerage CBRE said.
Successful startups often have to leave the neighborhood when they want to expand, real estate broker Bob Haley of CBRE said. The 9-acre Mattel facility was big enough to keep Varda in the city.
Last year, Varda subleased about 55,000 square feet of lab space from alternative protein company Beyond Meat at 888 Douglas St. in El Segundo, which it started moving into in June.
Varda will get the keys to its new building in December and spend four to eight months building production and assembly facilities as it ramps up operations. By the end of next year, it expects to have constructed 10 more spacecraft.
In the future, Varda could consolidate offices there, given its size. Currently, though, the plan is to retain all properties, creating a campus of three buildings within a mile of one another that are served by the company’s transportation services, Chief Operating Officer Jonathan Barr said.
“We already have Varda-branded shuttles running up and down Aviation Boulevard,” he said.
Ships near the Strait of Hormuz before and after attacks began
Every day, around 80 oil and gas tankers typically pass through the Strait of Hormuz, the narrow waterway off Iran’s southern coast that carries a fifth of the world’s oil and a significant amount of natural gas.
On Monday, just two oil and gas tankers appear to have crossed the strait, according to a New York Times analysis of shipping activity from Kpler, an industry data firm. Since then, one tanker passed through.
“It’s a de facto closure,” said Dan Pickering, chief investment officer of Pickering Energy Partners, a Houston financial services firm. “You’ve got a significant number of vessels on either side of the strait but no one is willing to go through.”
Tankers have been staying away from Hormuz since the U.S.-Israeli attacks on Iran that began on Saturday. A prolonged conflict could ripple broadly across the global economy, threatening the energy supplies of countries halfway around the world and stoking inflation.
International oil prices have climbed 12 percent since the fighting began, trading Tuesday around $81 a barrel, and natural gas prices have surged in Europe and in Asia.
A senior Iranian military official threatened on Monday to “set on fire” any ships traveling through the Strait of Hormuz. Vessels in the region have already come under attack. Several oil and gas facilities have also been struck or affected by nearby shelling, though the damage did not initially appear to be catastrophic.
Where ships and energy facilities have been damaged
A fire broke out Tuesday at a major energy hub in Fujairah, United Arab Emirates, from the falling debris of a downed drone, the authorities said. On Monday, Qatar halted production of liquefied natural gas, or fuel that has been cooled so that it can be transported on ships, after attacks on its facilities.
The sharp reduction in tanker traffic is reducing the supply of oil and gas to world markets, pushing up prices for both commodities. And the longer that ships stay away from the Strait of Hormuz, the less oil and gas get out to the world, which could raise prices even more.
Shipping companies have paused their tankers to protect their crew and cargo, and because insurance companies are charging significantly more to cover vessels in the conflict area.
On Tuesday, President Trump said that “if necessary,” the U.S. Navy would begin escorting tankers through the strait. He also said a U.S. government agency would begin offering “political risk insurance” to shipping lines in the area.
In addition to tankers, other large vessels regularly go through the strait, including car carriers and container ships. In normal conditions, nearly 160 make the trip each day.
Some ships in the region turn off the devices that broadcast their positions, while others transmit false locations — making it hard to give a full picture of the traffic in the strait.
The Shiva is a small oil tanker that has repeatedly faked its location, according to TankerTrackers.com, which tracks global oil shipments. It is suspected of carrying sanctioned Iranian oil, according to Kpler. The Shiva was one of the two tankers that crossed the strait on Monday.
The oil and gas that typically move through the strait come from big producing countries like Saudi Arabia, Iraq, Iran and United Arab Emirates, and are exported around the world.
Where tankers moving through the Strait have traveled
In 2024, more than 80 percent of the oil and gas transported through the Strait of Hormuz went to Asia. China, India, Japan and South Korea were the top importers, according to the U.S. Energy Information Administration.
Countries have energy stockpiles that could last them into the coming months, but a continued shutdown of the strait could damage their economies.
Several big disruptions have roiled supply chains in recent years, but the tanker standstill in the Strait of Hormuz could have an outsize impact.
Paramount Skydance’s jubilation over its come-from-behind victory to claim Warner Bros. Discovery has entered a new phase:
Call it the deal-debt hangover.
Two major ratings agencies have raised concerns about Paramount’s credit because of the enormous debt the David Ellison-led company will have to shoulder — at least $79 billion — once it absorbs the larger Warner Bros. Discovery, bringing CNN, HBO, TBS and Cartoon Network into the Paramount fold.
Fitch Ratings said Monday that it placed Paramount on its “negative” ratings watch, and downgraded its credit to BB+ from BBB-, which puts the company’s credit into “junk” territory. Fitch said it took action due to “uncertainty” surrounding Paramount’s $110-billion deal for Warner Bros. Discovery, which the boards of both companies approved on Friday.
S&P Global Ratings took similar action.
To finance the Warner takeover, Ellison’s billionaire father, Larry Ellison, has agreed to guarantee the $45.7 billion in equity needed. Bank of America, Citibank and Apollo Global have agreed to provide Paramount with more than $54 billion in debt financing.
“Potential credit risks include the prospective debt-funded structure, Fitch’s expectation of materially elevated leverage and limited visibility on post-transaction financial policy and capital structure,” Fitch said.
Late last week, Paramount sent $2.8 billion to Netflix as a “termination fee” to officially end the streaming giant’s pursuit of Warner Bros. That payment paved the way for Warner and Paramount’s board to enter into the new merger agreement.
Paramount hopes the merger will be wrapped up by the end of September. It needs the approval of Warner Bros. Discovery shareholders and regulators, including the European Union.
Paramount executives acknowledged this week the new company would emerge with $79 billion in debt — a considerably higher total than what Warner Bros. Discovery had following its spinoff from AT&T. That 2022 transaction left Warner Bros. Discovery with nearly $55 billion of debt, a burden that led to endless waves of cost-cutting, including thousands of layoffs and dozens of canceled projects.
Warner still has $33.5 billion in debt, a lingering legacy that will be passed on to Paramount.
Paramount plans to restructure about $15 billion in Warner Bros. Discovery’s existing debt.
Paramount CEO David Ellison at a 2024 movie premiere for a Netflix show.
(Evan Agostini / Invision / AP)
Paramount told Wall Street it would find more than $6 billion in cost cuts or “synergies” within three years — a number that has weighed heavily on entertainment industry workers, particularly in Los Angeles.
Hollywood already is reeling from previous mergers in addition to a sharp pullback in film and television production locally as filmmakers chase tax credits offered overseas and in other states, including New York and New Jersey.
Some entertainment executives, including Netflix Co-Chief Executive Ted Sarandos, have speculated that Paramount will need to find more than $10 billion in cost cuts to make the math work. More recently, Sarandos went higher, telling Bloomberg News that Paramount may need $16 billion in cuts.
Cognizant of widespread fears about additional layoffs, Paramount Chief Operating Officer Andrew Gordon took steps this week to try to tamp down such concerns.
Gordon is a former Goldman Sachs banker and a former executive with RedBird Capital Partners, an investor in Paramount and the proposed Warner Bros. deal. He joined Paramount last August as part of the Ellison takeover.
During a conference call Monday with analysts, Gordon said Paramount would look beyond the workforce for cuts because the company wants to maintain its film and TV production levels.
Paramount plans to look for cost savings by consolidating the “technology stacks and cloud providers” for its streaming services, including Paramount+ and HBO Max, Gordon said. The company also would search for reductions in corporate overhead, marketing expenses, procurement, business services and “optimizing the combined real estate footprint.”
It’s unclear whether Paramount would sell the historic Melrose Avenue lot or simply centralize the sprawling operations onto the Warner Bros. and Paramount lots in Burbank and Hollywood.
Workers are scattered throughout the region.
HBO, owned by Warner Bros. Discovery, maintains its West Coast headquarters in Culver City; CBS television stations operate from CBS’ former lot off Radford Avenue in Studio City; and CBS Entertainment and Paramount cable channels executive teams are located in a high-rise off Gower Street and Sunset Boulevard, blocks from the Paramount movie studio lot.
“The combination of PSKY and WBD could create a materially stronger business than either individual entity,” Standard & Poor’s said in its note to investors. “However, this transaction presents unique challenges because it would involve the combination of three companies, with the smallest, Skydance, being the controlling entity.”
David Ellison’s production firm, Skydance Media, was the entity that bought Paramount, creating Paramount Skydance.
Ellison has not announced what the combined company will be called.
Paramount shares closed down more than 6% Tuesday to $12.45.
Warner Bros. Discovery fell 1% to $28.20. Netflix added less than 1% to close at $97.70.
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