TikTok ‘here to stay’ - Trump gives Oracle proposal the green light.
Following Microsoft’s failed negotiations with ByteDance, an announcement was made on Saturday by TikTok announcing that Oracle would acquire the United States’ operations of TikTok, being labelled as a ‘trusted technology provider’. Alongside this, the platform also revealed that a commercial partnership with Walmart is in the works.
“I approved the deal in concept”, US President Donald Trump announced shortly after. “If they get it done, that’s great. If they don’t, that’s okay too.”
This TikTok proposal was forced by Trump’s warnings in August of banning the popular social media platform from US app stores, on the grounds that Chinese technology companies pose security threats to the US. This deal will make Oracle responsible for all US user data and would grant it the right to inspect TikTok’s source code, satisfying the national security requirements that Trump has called for. However, this falls short of the US President’s demand for a complete sale of TikTok’s US operations.
Both companies are expected to take a 20% cumulative stake in the newly established company, TikTok Global. Though this leaves ByteDance with the remaining 80%, the Trump administration claims that US venture capital investors hold a 40% stake in the parent company, leading to the calculation of this deal as majority-owned by American investors. As such, President Trump has said TikTok Global will be “totally controlled by Oracle and Walmart”.
The stark difference between Oracle and TikTok cannot be dismissed. The corporation is known for selling database technology and cloud systems to businesses, as well as the US government intelligence community, while the social media platform is a casual app with a much younger userbase. It is spectated that Oracle was considered the most trustworthy option given its history in intelligence. As well as this, the deal also expects TikTok Global to be headquartered in the US, hiring approximately 25,000 workers, and also contributing a $5 billion US education fund. “That’s their contribution that I’ve been asking for,” Trump states.
Despite the US President’s blessing, the Chinese government is yet to approve the deal. Without this guarantee, it can only be said that TikTok’s ban from US app stores has only been delayed.
by Nicole Woo