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Perplexity AI’s Merger Proposal Could Save TikTok US
Perplexity AI, a U.S.-based AI search engine startup, has submitted a bid to merge with TikTok US, according to a Reuters report. The proposal suggests forming a new company by combining Perplexity, TikTok US, and New Capital Partners. This plan would let most of ByteDance’s current investors keep their stakes.
The clock is ticking & TikTok is at risk of being banned in the US because of its ties to ByteDance, its Chinese parent company. The ban, which is set to begin on Sunday, stems from national security concerns over ByteDance’s data practices. The US government is concerned about national security and how TikTok handles user data.
A recent decision by the US Supreme Court requires TikTok to either cut ties with ByteDance or stop operating in the country.
President-elect Donald Trump, however, indicated on Saturday that he may grant TikTok a 90-day reprieve starting Monday, giving the company more time to resolve the issue.
Perplexity AI’s merger proposal differs from an outright sale. It would allow most ByteDance investors to keep their stakes, while also integrating TikTok’s video capabilities into Perplexity’s search engine platform.
The startup is known for its AI-powered search tools that provide quick, cited answers to user queries, using large language models such as OpenAI’s technology and Meta’s open-source model, Llama.
ByteDance has made it clear that it doesn’t want to sell TikTok US outright, even though many people, including billionaire Frank McCourt, Shark Tank investor Kevin O’Leary, and former Treasury Secretary Steven Mnuchin, have shown interest in taking over.
This is where Perplexity AI’s proposal stands out—it’s offering a merger, not a sale. This approach might appeal to ByteDance because it lets existing investors keep their shares while also addressing US concerns about TikTok’s ownership.
If successful, the deal could offer a way for TikTok to stay operational in the US while addressing national security concerns. At the same time, Perplexity would gain valuable video content to enhance its search engine capabilities.
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