Oracle wins bid for TikTok in the US
The owner of TikTok chose Oracle to buy the popular video-sharing app over Microsoft according to the source that the deal was unauthorized to talk about it.
On Sunday, Microsoft announced its rejection of TikTok’s tech giant, removing it a week before President Donald Trump promised to implement a plan to ban the Chinese-owned U.S. app for spying concerns.
The White House and TikTok refused to comment on Sunday. Oracle did not return a comment request but declined the comment before.
Sunday Walmart said that he “preserved his stake in an investment of TikTok” and talks to ByteDance and other parties about the acquisition with Microsoft.
By September 20th the administration of Trump threatened to prohibit TikTok and ordered ByteDance to sell its American company claiming that its Chinese ownership would place the national security risk behind it. The government is concerned about the fact that Chinese authorities are being drunk with user data. TikTok denies that it is a national security risk and tries to prevent the threatened ban by the administration.
It is not obvious whether the proposed purchase will cover only the U.S. business of TikTok, and how it will be divided from the other popular social media platform of TikTok worldwide. ByteDance also owns the Chinese market with a second application, Douyin.
The US Foreign Investment Committee, CFIUS, a government group chaired by the Treasury Secretary, who studies mergers for reasons of national security must still review any agreement. Every deal must be discussed. A transaction recommended by the panel can be approved or rejected by the president, although Trump has already expressed support for Oracle as a “great company” that can manage the acquisition.
In a Sunday statement, Microsoft said that Bytedance “let’s tell that it won’t sell Microsoft to TikTok’s US operations today.”
The company said, “It would have made significant changes to ensure that the service meets the highest standards for safety, privacy, online security as well as the disinformation control.” Microsoft added, “Our proposal would have been useful for TikTok’s users while protecting the national security interests.
TikTok is known for its fun goofy videos of dancer, lip-syncing, pranking, and jokes, saying it has 100 million U.S. users and about 700 million globally. More political content like comedian Sarah Cooper, who drew a large audience by lip-syncing the often disjointed statements made by Trump from public performances, recently founded it.
However, because of its Chinese ownership, the app also raised concerns. The White House has raised concerns that Chinese authorities could obtain U.S. User Data, including television Huawei & ZTE equipment and the WeChat messaging app. Republican and Democratic legislators raised concerns about censorship and the privacy of children.
TikTok denies having shared or requested user information with the Chinese government. At the request of Chinese authorities, the company says it has not censored videos and insists that it is not a threat to national security.
TikTok sued for ending the ban, but not for selling. There were several factors that complicated the negotiations, including Trump’s repeated demand for any deal, stipulation, or role for the president, which experts claim is never before, from the U.S. Government. The U.S. government.
In addition, at the end of August, the Chinese government unveiled new rules limiting technology exports, likely including the TikTok artificial intelligence system, to choose from which videos its users can spread. ByteDance would therefore be required to obtain from China a license to export such technology to a foreign company.
Despites TikTok ‘s efforts to distance its application from its Chinese ownership, the agreement was concluded quickly as the administration increased its menaces against TikTok this summer. The company has established Kevin Mayer, executive director of Disney, as its American CEO. After only a couple of months in August, he resigned, saying “the political environment has significantly changed.”
Microsoft and Oracle are known better than for consumers for their business software offerings.
Oracle mainly produces software from the database. They compete against technological giants like Microsoft and Amazon who offer cloud services as well as specialists in business software such as Salesforce.
Some analysts consider Oracle’s interest in a consumer enterprise to be wrong. Oracle should concentrate on corporate market acquisitions rather than investing in a consumer application like TikTok which doesn’t fit into the rest of the company, said Jefferies analyst Brent Thill, who compares the idea with Delta Airlines buying a motorcycle company. “There is no sense here,” he said.
Thill suggested that the company’s buyer should be TikTok competitors like Facebook and Snapchat, as Oracle “does not add much value to the application.”
Larry Ellison is an outstanding co-founder of Oracle and his tech managers are hosting a fundraiser for President Donald Trump in February at his Rancho Mirage, a property in California. Vice President Mike Pence was also hired by the company; its CEO, SafraCatz, served as the transition team of Trump.
On August 18, the President said that Oracle was “a great company” that “can handle” TikTok purchases. He refused to make Oracle and Microsoft his preference as buyers.