Elon Musk is once again in the spotlight amid rumors of his interest in acquiring TikTok, which could transform the social media landscape in the United States. According to estimates by Dan Ives, an analyst at Wedbush Securities, the billionaire would have to spend between $40 billion and $50 billion to acquire the social media platform, a figure comparable to the $44 billion Musk paid for Twitter in 2022. This raises the possibility that acquiring TikTok could be a new strategic move by Elon Musk in the social media space.
TikTok’s growing influence in the U.S.
The Chinese social network has become one of the most popular in the U.S., with approximately one-third of the population using it, according to Pew Research data. Additionally, TikTok is expected to generate $15.53 billion in advertising revenue in the U.S. alone by 2025, reflecting significant growth. This has placed the app on the radar of entrepreneurs like Elon Musk, who are eager to capitalize on its expansion.
However, the sale of TikTok faces significant obstacles. ByteDance, the parent company, has denied the sale rumors, while reports from Bloomberg and The Wall Street Journal suggest that the Chinese government may be willing to allow the transaction to Musk in order to avoid a ban on the platform in the U.S. However, TikTok’s algorithm, key to its success, would not be included in the purchase, which could make the acquisition less appealing.
Political hurdles and regulatory challenges
The situation is further complicated by the political context in the U.S. If ByteDance does not sell TikTok’s U.S. operations before January 19, the platform could be banned under laws passed by Congress. However, the Supreme Court is reviewing an appeal, which could delay or even overturn the decision. Moreover, the new president, Donald Trump, has criticized the ban and may extend the deadline for the sale of TikTok.
In this context, Elon Musk’s relationship with China, through Tesla, and his proximity to Trump could play a key role in the acquisition. Tesla generates 23% of its revenue in China, strengthening Musk’s ties to the Asian country. Additionally, his relationship with Trump could help overcome regulatory hurdles in the U.S.
Elon Musk, known for his multi-million-dollar acquisitions and influence in the tech world, faces a significant challenge if he decides to proceed with acquiring TikTok. Political and regulatory factors could be decisive in the outcome of this deal.
