• Perplexity AI has submitted a merger bid to TikTok's parent, ByteDance.
• A U.S. ban on TikTok looms unless it severs ties with ByteDance.
• The proposed merger aims to combine resources and retain investor equity.
• Perplexity AI’s search tools leverage advanced language models.
• President-elect Trump may grant TikTok a 90-day reprieve from enforcement.

On January 18, 2025, U.S. search engine startup Perplexity AI proposed a merger with TikTok's Chinese parent company, ByteDance, to create a new entity that would enable TikTok U.S. to continue operations amidst an impending ban. According to a confidential source speaking to Reuters, this merger approach is seen as more viable than a sale, helping the company maintain the required investor confidence.

Currently, TikTok is under pressure to cut ties with ByteDance or face a shutdown starting soon. However, President-elect Donald Trump indicated a potential 90-day reprieve on enforcement for the popular short-video platform, which has become a vital part of daily life for nearly half of all Americans. A similar report from USA Today highlighted that TikTok has threatened to go dark in the U.S. unless the Biden Administration provides assurances to tech giants like Apple and Google against enforcement actions.

The proposed merger would allow most of ByteDance’s current investors to retain their equity stakes while enhancing Perplexity AI’s capabilities by incorporating more video content. The company's search technology aids users in acquiring rapid answers to their inquiries by utilizing large language models from notable organizations, including OpenAI.

As Perplexity AI navigates toward this ambitious merger, the stakes remain high for TikTok, which has been instrumental in shaping modern online culture and facilitating small business growth, faced with an uncertain future.