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Billionaire Frank McCourt says he's putting together a consortium to buy TikTok

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LA Post: Billionaire Frank McCourt says he's putting together a consortium to buy TikTok
May 15, 2024
HALELUYA HADERO - AP

Billionaire businessman and real estate mogul Frank McCourt said Wednesday that he’s putting together a consortium to purchase TikTok’s U.S. business, adding to the number of investors hoping to benefit from a new federal law that requires TikTok’s China-based parent company to sell the popular platform or face a ban.

McCourt is organizing the bid in consultation with the investment bank Guggenheim Securities and “with the goal of placing people and data empowerment at the center of the platform’s design and purpose,” according to an announcement on the website of his Project Liberty initiative.

If a sale occurs, the former owner of the Los Angeles Dodgers said he would plan to restructure TikTok and give more agency to people “over their digital identities and data” by migrating the platform to an open-source protocol that allows for more transparency.

McCourt said he doesn’t use TikTok personally, but his businesses and internet-focused initiative do. The bid is an extension of his long-running interest in remaking the internet with better data privacy protections, an effort he's focused on through Project Liberty. He founded the project “to build a new digital civic architecture for a safer, healthier internet,” according to the organization's website.

So far, his vision to remake TikTok has received the backing of Jonathan Haidt, a well-known social psychologist whose recent book “The Anxious Generation” focuses on how smartphones and social media have contributed to a mental health crisis among young people.

“We thought this was a really fantastic opportunity to accelerate the creation of an alternative internet,” McCourt told The Associated Press in an interview.

Other investors, including former Treasury Secretary Steven Mnuchin, have expressed a desire to purchase TikTok. However, parent company ByteDance has already said it does not plan to sell the platform. Some experts have also noted the Chinese government is also unlikely to approve a sale – especially not one that includes the recommendation engine that powers the videos that populates users’ feeds.

McCourt said he's not interested in TikTok's current algorithm because “top-down” recommendation engines conflict with his view of how such platforms should be managed. He also thinks ByteDance will sell TikTok’s U.S. business at some point.

For now, though, the company has been fighting back against the law passed last month, which would disrupt one of its most lucrative markets.

Last week, ByteDance and TikTok filed a lawsuit against the U.S. government to block the law from going into effect. On Tuesday, eight TikTok creators filed their own challenge, arguing the law violates their First Amendment rights to free speech.

The company also has been waging a legal battle in Montana to block a state law that would ban the video-sharing platform.

On Tuesday, TikTok, Montana users and the state of Montana agreed to put a stay on a lawsuit challenging the constitutionality of Montana's first-in-the-nation ban while the federal lawsuits are decided.

Montana's law, which was temporarily blocked before it could take effect on Jan. 1, would be nullified if a company that is not based in a country designated as a foreign adversary acquires TikTok.

McCourt is worth $1.4 billion, according to Forbes. He sold the Dodgers for $2 billion in 2012 to Guggenheim Baseball Management. In 2016, he bought the French soccer club Marseille.

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Amy Beth Hanson in Helena, Montana, contributed reporting.

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