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Oracle To Absorb U.S. TikTok Operations

Oracle To Absorb U.S. TikTok Operations

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In the on-going saga that feels more like YouTube drama than Big Tech – Microsoft has today made public that its bid for TikTok has been rejected by Chinese-owned parent company ByteDance. This was soon followed by an announcement that Oracle has been chosen as the “trusted tech partner” for the app in the United States.

The uncertainty around the app’s operation in the U.S. arose after President Trump passed an executive order on the 14th August, 2020, citing data and security concerns, centred around how TikTok data on U.S. users was to be used by a Chinese owned company and government. This order provided ByteDance 90 days to sell the U.S. rights to the app to an American owned company – of which Microsoft and Oracle were expected to be the frontrunners. Microsoft, having teamed up with Walmart to make its bid. Oracle, partnering with venture capital firm Sequoia Capital and growth equity firm General Atlantic.

In response to the executive order, TikTok filed a lawsuit against the potential ban. The company citing the U.S. government has faced a “lack of due process” in engaging with and working through concerns with the company – as the ABC reports the U.S. government had allegedly paid no attention to the facts. 

While there have been no updates since the end of August in regards to the lawsuit against the U.S. government, Microsoft have since confirmed they will not be absorbing the management of TikTok in the U.S. and the Wall Street Journal have announced that Oracle will be absorbing American operations of the video-sharing app.

In a statement, Microsoft confirmed that “ByteDance let us know today they would not be selling TikTok’s U.S. operations to Microsoft. We are confident our proposal would have been good for TikTok’s users, while protecting national security interests. To do this, we would have made significant changes to ensure the service met the highest standards for security, privacy, online safety, and combatting disinformation, and we made these principles clear in our August statement. We look forward to seeing how the service evolves in these important areas.” 

The response to the announcement has been mixed – many disappointed at Microsoft being rejected and raising concerns as to Oracle’s close ties with the Trump administration.

According to the Wall Street Journal what will follow the agreement between ByteDance and Oracle, will be a process of approval from the White House and the Committee on Foreign Investment. This will include an evaluation of the data security changes, in order to satisfy the main concerns of the Trump government.

With a 20th September deadline in place for an agreement to be made and sale to be processed, we are holding our breath over Oracle’s plans for the future of the app, which has over 100 million active users in the U.S.

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Oracle has made no official statement at the time of publication.

Still confused – we break it down below.

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