Perplexity AI officially made a play for TikTok on Saturday, submitting a bid to its parent company, ByteDance, to create a new merged entity combining Perplexity, TikTok U.S. and new capital partners, CNBC has learned.

The new structure would allow for most of ByteDance’s existing investors to retain their equity stakes and would bring more video to Perplexity, according to a source familiar with the situation, who asked to remain anonymous due to the confidential nature of the potential deal.

Perplexity AI, the artificial intelligence search engine startup competing with OpenAI and Google, started 2024 with a roughly $500 million valuation and ended the year with a valuation of about $9 billion, after attracting increasing investor interest amid the generative AI boom — as well as controversy over plagiarism accusations.

AI-assisted search has been viewed by investors as one of Google’s key risks, as it potentially changes the way consumers access information online. Last year, OpenAI, which started the generative AI craze in late 2022 with ChatGPT, introduced a search engine called SearchGPT. Google later launched “AI Overviews” in search, allowing users to see a quick summary of answers at the top of results.

Though any potential transaction between Perplexity AI and ByteDance would likely take months to complete — and TikTok has said the app will “go dark” in the U.S. on Sunday unless the Biden administration assures it won’t punish Apple, Google and other service providers for hosting it — President-elect Donald Trump told NBC News on Saturday that he “most likely” would give TikTok 90 more days to work out a deal after he is sworn into office on Monday.

In a video posted to TikTok on Friday, CEO Shou Zi Chew said, “I want to thank President Trump for his commitment to work with us to find a solution that keeps TikTok available in the United States.”

ByteDance has publicly implied it will not sell TikTok U.S., which is part of why Perplexity AI believes it has a shot with its bid — since the proposal is a merger rather than a sale, the source told CNBC.

The source believes a fair price is “well north of $50 billion” but that the final number attached to the proposal will be decided, in part, by which of ByteDance’s existing shareholders want to remain part of the new entity and which want to cash out.

CORRECTION: Perplexity AI’s bid for TikTok would create a new merged entity combining Perplexity, TikTok U.S. and new capital partners. A previous version of this article misstated one of the participants.

With the prospect of TikTok disappearing in the U.S., creators on the app spent the week posting heartfelt goodbyes to their fans.

“I never even in a million years ever thought that anybody would ever just care about what I say,” Kimberly Rhoades, a creator of humorous videos, told her 3 million followers on Thursday. “If this app goes away, it was a beautiful, beautiful ride.”

A day later, the Supreme Court ruled 9-0 to uphold the law requiring a forced sale of TikTok by Chinese-parent ByteDance or a ban of the app in the U.S. The short-form video app that rose to mainstream popularity and changed the way Americans consumed social media while stuck indoors during the pandemic is set to go dark as soon as Sunday, meaning it could disappear from the web and be removed from app stores run by Apple and Google.

Congress passed the law, signed by President Joe Biden, citing national security concerns due to TikTok’s data collection practices and ties to China.

In a follow-up video on Friday, Rhoades hummed about 30 seconds of “Taps,” the military song often played at funerals. She ended by saying, “It was an honor making you laugh.”

TikTok’s fate in the U.S. now lies in the hands of President-elect Donald Trump,  who originally favored a TikTok ban during his first administration, but has since flip-flopped on the matter. In December, Trump asked the Supreme Court to pause the law’s implementation and allow his administration “the opportunity to pursue a political resolution of the questions at issue in the case.”

In a Friday post on his social media app Truth Social, Trump wrote, “My decision on TikTok will be made in the not too distant future, but I must have time to review the situation. Stay tuned!” TikTok CEO Shou Chew is one of several tech leaders expected to be in attendance at Trump’s inauguration in Washington, D.C., on Monday. In a short video, Chew thanked Trump “for his commitment to work with us to find a solution that keeps TikTok available” in the U.S.

Whether Trump ultimately finds a way to keep the app alive for American consumers, many TikTok creators have been preparing for an end, telling their fans to find them on other social platforms such as Google’s YouTube and Meta’s Facebook and Instagram, CNBC previously reported. RedNote, a Chinese social media app and TikTok look-alike, rose to the top of Apple’s app store on Monday, indicating that TikTok’s millions of users were seeking alternatives.

The creator migration appears to have picked up steam as the ban deadline approached. Influencers like Megan Cruz used their farewell videos as an opportunity to tout the attributes of TikTok.

“People were engaged with things like BookTok and FilmTok and the idea of being engaged in culture on TikTok because you didn’t have to be a big creator,” said Cruz, in a video posted earlier this week. “There was incentive for people to join the conversation because anyone had the potential to be a leader in a conversation, to make a point that resonated with millions of people.”

The history of TikTok as a viral sensation dates back to 2017, when ByteDance spent about $1 billion to acquire a startup called Musical.ly. ByteDance combined Musical.ly and TikTok the following year.

TikTok began making headway in the U.S. around that time, primarily as an app that young people used for short dance clips and lip-syncing videos. TikTok’s big break came during the pandemic lockdowns of 2020, when consumers were looking for ways to pass the time and connect with others online.

The app was so successful that internet giants Meta and Google launched copycat services. Meta introduced Reels for U.S. Instagram users in August 2020 and then added it to Facebook. Google rolled out YouTube Shorts in the U.S. in March 2021.

Despite the competition, TikTok continued to grow. 

TikTok has about 115 million monthly active users in the U.S., compared to 258 million for YouTube, 253 million for Facebook and 131 million for Instagram, according to market intelligence firm Sensor Tower.

Though TikTok lags its rivals in total users, the Chinese app has become a hub for creators, defined as users with more than 1,000 followers. TikTok has nearly 8.5 million users in the U.S. who fit that category, compared with about 5.2 million on Instagram and 1.1 million on YouTube, according to HypeAuditor, an influencer marketing platform. 

Businessman Frank McCourt’s internet advocacy group Project Liberty announced on Jan. 9, that it had submitted a proposal to buy TikTok from ByteDance at undisclosed terms. McCourt told CNBC on Friday that “we, I believe, are the only bidder” that meets the necessary criteria of disentangling the technology from the Chinese algorithm.

If ByteDance decides to sell, potential buyers may have to spend between $40 billion and $50 billion, according to a valuation estimate of TikTok’s U.S. operations from CFRA Research Senior Vice President Angelo Zino. 

Some creators, anticipating a shutdown, are letting their fans know where they can find them. Others are encouraging users not to follow them on Meta’s services, or encouraging them to take a break from social media altogether. 

“I’ve been hearing a lot of people say that once TikTok is gone, you’re just going to cut social media out of your life and I encourage that – it’ll probably be really healthy for you,” said Jack Ryan, a creator with 2 million TikTok followers, in a video on Thursday thanking his fans for their support. 

“I do have an Instagram. I do have a sizable following on there, but don’t follow me on Instagram,” Ryan added. “Don’t go on there. It’s brain rot. It’s gross.”

Jonas Gindin, who has more than 400,000 Tiktok followers, said in a video that a year and a half ago he was waiting tables while trying to become an actor in Los Angeles. He wasn’t having much luck.

After finding a fanbase on TikTok, Gindin said he’s managed to produce content full-time on the app. 

“If we’re cooked, it’s been a ride, man,” Gindin said. “Anytime I see someone comment something positive, it means the world, bro.”

WATCH: Up to Apple and Google if they want to keep TikTok on their app stores, says NSA’s Gerstell

Two decades ago, Google co-founder Larry Page had an idea that would forever change the way we navigate the world.

“Larry drove down some of these streets with a video camera and handed it to someone and said, ‘Hey, what can you do with this?'” said Maria Biggs, technical program manager at Google Street View, a prominent feature in Google Maps.

In a car equipped with the latest Street View camera, Biggs took CNBC on a ride near Google’s Silicon Valley headquarters. First introduced in 2022, it’s the first camera model that can be added onto any car, rather than being built into the vehicle.

“We’re going to Hawaii with these next generation camera systems because we don’t have to ship the whole car,” Biggs said. “We can just put the camera system in a box and ship it there and then rent the car when we’re there.”

Biggs said the new technology will allow Google to update data on some places for the first time in 10 years.

“We’re going to be able to easily move these cameras around and have more freshness in our maps,” she said.

With more than 2 billion monthly users, Google Maps is the world’s top navigation app. As Maps approaches its 20th anniversary in February, Google is working hard to keep that lead, with the help of the new cameras, as well as generative artificial intelligence.

The more nimble cameras are allowing Google to make updates to dozens of countries. It’s also mapping at least three new ones — Bosnia and Herzegovina, Namibia, and Liechtenstein. Street View cameras are a significant part of how Google gathers data for Maps, but it also relies on satellite and aerial images, and information from more than 1,000 third-party sources, such as local governments and users. That mass data collection system allows Google to offer maps in more than 250 countries and territories. 

Gemini is also enabling voice-activated reports in Waze, which Google bought in 2013 for $1.3 billion. That data gets fed into Google Maps to help alert drivers on both apps about hazards in real time.

“We hope that our products are helping people navigate more confidently and safely,” said Chris Phillips, vice president and general manager of Google Geo, the division that runs Maps. He said Waze is also helping improve safety on roadways by “letting people know a particular street has had issues in the past, and we’ve seen a noticeable change in people’s behaviors when they’re driving down those streets.”

Waze is also known for offering alternate routes.

“We’ll give you some more provocative maneuvers along the way,” Phillips said, when it comes to “beating the traffic and getting around.”

But alternate routes have also worsened traffic in some neighborhoods, where small roads can be ill equipped to handle many cars.

Phillips said Google only uses public roads and works with the local authorities to adhere to rules for specific streets.

“The use of these navigation apps, whether embedded or on smartphone devices, is almost universal,” said James Hodgson, who covers automotive for ABI Research.

Hodgson said that one problem currently is that the technology is targeted on a user-by-user basis. To improve efficiency, he said, “we are approaching a point where there needs to be a broader, almost fleet-level view.”

A major “perception barrier” Google has faced, Hodgson said, is around data privacy.

Identifying information like faces and license plates are blurred on Google Maps, and users can request blurring an area on Street View to prevent a risk like thieves analyzing their property. 

Users can also turn off location history or delete places they’ve been. Certain places like abortion clinics or domestic violence shelters are auto-deleted. In December, Google started keeping location history on devices instead of in the cloud, making it tougher for authorities to access location history.

How much Google spends, and makes, on Maps is shrouded in secrecy. Parent company Alphabet doesn’t break out Maps in its earnings reports, clumping it in with other services like Search and YouTube. One of the only estimates comes from a 2019 Morgan Stanley report forecasting Maps would go from $2.95 billion in revenue in 2019 to $11 billion in 2023.

The revenue is largely built on a model that Google knows well: advertising.

“We’re always focused on giving people the result, when they’re searching for a restaurant or a place, that most accurately fits what they’re searching for, ” Phillips said. “And merchants have the opportunity to actually pay for advertising in order for their place to show up in that list.”

Google also makes money by selling a software interface with detailed data to solar companies looking for new customers. It has highly accurate rooftop images, measurements, elevation and shading for some 480 million buildings across 40 countries.

Google sells access to its Maps Platform to companies including Wayfair and Dominos. Developers have used it to build more than 10 million sites and apps for things like food delivery, ridesharing and real estate. For example, in 2019, Uber said it paid Google $58 million for its mapping technology over the previous three years.

Google’s Android Automotive operating system, with Maps, also makes money. It powers the infotainment systems in many cars from Polestar, Volvo, Honda, GM and Ford.

As robotaxis go mainstream, accurate mapping is crucial, and a big opportunity for Google.

Alphabet-owned Waymo dominated the U.S. robotaxi market in 2024, and passengers in Phoenix can hail one of the fully autonomous cars directly from the Google Maps app. Robotaxis also present the potential for a virtuous cycle.

“I think an ambition for Waymo, and something that we see from almost every other autonomous vehicle platform provider, is to try to close that loop and to use the same vehicles that benefit from the map to also contribute to the creation of that map,” Hodgson said. “That is the future of where mapping is going for autonomous driving.”

Watch the video learn more.