San Francisco, Sep 14 (efe-epa).- US software giant Oracle on Monday officially announced its agreement with China’s ByteDance to become partners in managing the TikTok social network in the US, thus confirming what had become public on Sunday after Oracle’s rival in vying for the company’s US operations, Microsoft, admitted its defeat in the negotiations.
“Oracle confirms (US Treasury) Secretary (Steven) Mnuchin’s statement that it is part of the proposal submitted by ByteDance to the Treasury Department over the weekend in which Oracle will serve as the trusted technology provider. Oracle has a 40-year track record providing secure, highly performant technology solutions,” the Redwood Shores, California-based firm said in a statement.
Mnuchin had conceded in an interview given previously to CNBC that he had received the proposal, explaining that the Donald Trump administration will review the pact this week.
The Treasury secretary said that the administration would have to assure itself that user data gathered by TikTok would remain secure and that users’ mobile phones would remain protected.
Trump, who says that Chinese ownership and management of TikTok constitutes a national security threat to the US, had given ByteDance until Sept. 15 to sell its US operations to a local firm or to be excluded from operating in the country.
Given its new – albeit pending – association with Oracle, TikTok will not have to shut down its US operations, although the deal still requires the approval of the US and Chinese governments, the latter of which in the past already has demonstrated its impatience with pressure brought to bear by Trump.
The selection of Oracle does not imply that there will be an outright “sale” of ByteDance’s business in the US, but rather that Oracle will become the firm’s partner for TikTok operations in this country, something that both firms say satisfies the requirements imposed by the president.
TikTok, which has more than 80 million users in the US, is one of the social networks that has shown the most growth in recent years, becoming the main entertainment vehicle for many teens and a marketing conduit for well-known celebrities.
Oracle, founded in 1977, is one of the pioneer Silicon Valley firms and its software is used by millions of companies all over the world.
The CEO and cofounder of Oracle, Larry Ellison – the fifth richest man in the world, according to Forbes magazine – is one of the few top executives in the tech sector who has publicly expressed his support for Trump and he even held a fundraising event for the president’s reelection campaign last February.
There had been speculation in recent weeks that the good feelings between Trump and Ellison could tilt the scale in Oracle’s favor, leaving Microsoft and potentially other firms out in the cold, and it has been suggested that the Chinese government – eager to guarantee TikTok’s operations in the US – might also be inclined to favor Oracle because of Ellison’s relationship with the president.
After the US government reviews the deal this week, it will forward a recommendation to the president, who will then either approve or reject the agreement.
Meanwhile, Walmart, another firm that had expressed interest in partnering with ByteDance to manage TikTok’s operations in the US, said in a statement that it remains interested in the social network if the Oracle deal falls through.
Walmart, the largest firm in the world both in annual sales and in terms of its payroll, sees in TikTok an opportunity to expand its own operations into the e-commerce and on-line advertising areas.