- The Chinese owner of TikTok- ByteDance has selected Oracle as the technology partner of the app for its U.S. operations and has declined a Microsoft acquisition bid
TikTok’s Chinese owner has selected Oracle as the technology partner of the app for its U.S. operations and has declined a Microsoft acquisition bid, according to officials from Microsoft and other people involved in the talks, as time runs out on President Trump’s executive order threatening to ban the famous app unless its American operations are sold.
It was unclear whether choosing Oracle as a technology partner by TikTok would mean Oracle also taking a majority ownership stake in the social media app, the people involved in the negotiations said. Microsoft had been seen as the American technology corporation with the deepest pockets for purchasing TikTok’s U.S. operations from its parent company, ByteDance, and with the greatest potential to resolve national security issues that contributed to Trump’s order.
The fast-moving sequence of events on Sunday came as the clock ticks down on Mr. Trump’s executive order, which said TikTok needed basically a deal to sell its US operations by Sept. 20 or risk being blocked in the US. But sales talks had been in a holding pattern since last month, China released new regulations that would prohibit TikTok from selling its technology to a foreign buyer without explicit Chinese government approval. And any subsequent agreement between the United States and China still might be a diplomatic piñata.
News of an Oracle deal comes just an hour after Microsoft revealed it was no longer acquiring TikTok after its bid was rejected by TikTok owner ByteDance. Microsoft had been pursuing a deal to buy TikTok’s operations in the US, Australia, Canada, and New Zealand. Its clear talks have swayed away from a full acquisition, with Oracle reportedly winning the bid to be a technology partner instead.
“ByteDance let us know today that they will not be selling the US operations of TikTok to Microsoft,” Microsoft says in a statement. “We are sure that our plan while maintaining national security interests, would have been ideal for TikTok users. To do this, we would have made substantial improvements to ensure that the service followed the highest expectations for security, privacy, online protection, and the battle against misinformation, and we made these values clear in our statement in August. We are looking forward to seeing how the service progresses in these main areas.
On 6 August, President Trump signed an executive order banning all transactions with ByteDance, and the order demanded that an American company buy TikTok’s US firm. The EO was supposed to take effect within 45 days, but a follow-up order was signed by the president granting ByteDance 90 days to sell or spin-off TikTok in the US. That order was the result of a company investigation by the US Foreign Investment Committee (CFIUS), which monitors US companies’ international acquisitions for any possible security risks.
Oracle has a history of cooperation with the U.S. government, making its relationship with TikTok a strategic step in the midst of the increasing undercurrent of the White House and Congress-run Chinese opposition.
