TikTok-Oracle Deal to Result in Separate US Firm: Report
In this new corporate entity, Oracle will be a minority shareholder, said the report on Tuesday, citing people familiar with the matter. However, what will be the size of Oracle's ownership is still not clear. But an important role the Cloud major will play is in ensuring that data of TikTok's users in the US are stored and processed within the boundaries of the country.
San Francisco, September 16: With details of TikTok-Oracle deal still scarce, a new Financial Times report suggests that the short video-sharing platform is likely to spin off into a separate US-headquartered company as per the arrangements.
In this new corporate entity, Oracle will be a minority shareholder, said the report on Tuesday, citing people familiar with the matter. However, what will be the size of Oracle's ownership is still not clear. But an important role the Cloud major will play is in ensuring that data of TikTok's users in the US are stored and processed within the boundaries of the country.
The Trump administration last month issued an executive order barring anyone from doing transactions with TikTok's Chinese parent ByteDance 45 days after the order was released. TikTok Global Operations Set to be Run From US as Part of Oracle-ByteDance Deal, Says Report.
The executive order was issued apparently to protect "national security" as the Trump administration earlier raised concerns that the Chinese government could have access to data of American users of TikTok, an allegation that both China and TikTok denied.
A subsequent order required the short video sharing platform to divest its operations in the US by September 20 or face a ban. Cloud major Oracle earlier this week confirmed a deal with ByteDance to serve as the "trusted technology provider."
TikTok also said that it had submitted a proposal to the US administration to resolve its "security concerns." US Treasury Secretary Mnuchin earlier CNBC that the US government plans to review the deal this week.
Despite the new arrangements with Oracle, TikTok's dependence on algorithms deployed from China may not end, according to the Financial Times report.
(The above story first appeared on LatestLY on Sep 16, 2020 10:08 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).