Dan Ives, global head of tech research at Wedbush Securities, recently appeared on CNBC’s ‘The Exchange’ to discuss the high-stakes situation surrounding the potential U.S. ban on TikTok. Ives described the scenario as a game of high-stakes poker, suggesting that former President Donald Trump might issue a 90-day stay to facilitate negotiations for TikTok’s sale or restructured ownership. He believes Elon Musk, in conjunction with his social media platform X, could be pivotal in acquiring TikTok, potentially at a valuation of $40 to $50 billion, excluding the app’s algorithm. Oracle (ORCL) was also mentioned as a possible player in this scenario.
Ives emphasized the geopolitical implications, noting that the U.S. and China are deeply invested in finding a solution rather than enforcing a ban due to the complexity of U.S.-China relations. He highlighted that a ban would be the last resort, predicting that behind-the-scenes negotiations would lead to some form of agreement to keep TikTok operational in the U.S.
Addressing the market’s reaction, Ives pointed out that social media stocks like Meta (META) had initially sold off under the assumption that the ban would take effect. However, as the reality of the situation became clearer, with indications from political insiders that a ban was undesirable, stocks began to recover. He suggested that if Musk were to lead a consortium to buy TikTok, it could turn out to be positive for the social media sector, despite the initial negative impact.
The discussion also touched on the practical implications for tech giants like Google (GOOG) and Apple (AAPL), who would need to decide by the weekend whether to support TikTok on their platforms. Ives believes these companies will not have to face this decision immediately, as he anticipates that the ban will not be enforced. He underscored the complexity of the situation for these tech companies, which would need clear legal cover to proceed with any action regarding TikTok’s availability.
Ives concluded by expressing his confidence that TikTok would not be removed from app stores come Sunday, advocating for a scenario where TikTok finds a new ownership structure or partnership that includes significant U.S. tech involvement. He highlighted the strategic importance of maintaining access to TikTok’s 170 million U.S. users, indicating that this issue is too significant to let slide into a full ban, which could have broader negative effects on other U.S. companies with stakes in China.
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