Perplexity AI Aims to Merge With TikTok US

Perplexity AI, a fast-growing AI search engine startup, made a bold move this weekend, offering to combine forces with TikTok and its parent company, ByteDance. The proposal suggests merging Perplexity, TikTok U.S., and new investors to create a fresh entity.

This move would allow ByteDance’s current investors to keep their stakes while adding even more video content to Perplexity’s platform.

Now, let’s take a quick look at the key players here. Perplexity AI, which started 2024 valued at around $500 million, has soared in value, reaching approximately $9 billion by the end of the year. This surge is driven by the explosion of interest in generative AI (the technology behind things like ChatGPT) and some controversies, like accusations of plagiarism.

But even with these challenges, Perplexity is being seen as a serious competitor to big players like OpenAI and Google.

For investors, AI-powered search engines like Perplexity represent a major shift in how people might search for information online, making traditional search engines like Google potentially vulnerable.

Last year, OpenAI even launched SearchGPT, a search engine using its own AI, and Google introduced AI Overviews to provide quick answers at the top of its search results.

Now, there’s a lot of speculation around Perplexity’s bid. If the deal between Perplexity and ByteDance moves forward, it could take several months to finalize. Meanwhile, TikTok faces an uncertain future in the U.S., with the app threatening to go offline unless the government assures that it won’t penalize major service providers like Apple and Google for hosting it.

But in a video posted on TikTok, CEO Shou Zi Chew expressed his thanks to President Trump for his commitment to finding a solution to keep TikTok running in the U.S.

ByteDance has publicly stated it doesn’t want to sell TikTok U.S., which is why Perplexity AI sees a merger as the perfect solution. Instead of buying TikTok, Perplexity wants to combine forces and create a new joint venture.

Sources suggest the deal could be worth "well north of $50 billion," but the final value will depend on how many of ByteDance’s current investors want to stay on board and how many prefer to cash out.

References:

• Yahoo Finance

• CNBC