Oracle and Microsoft Are Reportedly in Talks to Take over TikTok

In the early hours of the weekend, the story of TikTok in the US took a new turn, when it was disclosed that the Trump administration is allegedly developing a strategy to keep the app alive in the US following its prohibition. Under the terms of the deal, which was mediated by the White House, TikTok’s operations in the US would be taken over by software major Oracle and a consortium of outside investors, including Microsoft.

According to NPR, Oracle and a consortium of investors, including Microsoft, are in negotiations to acquire TikTok’s international and global operations. ByteDance will retain a minority share in TikTok under the agreement, which the White House is apparently discussing, while “Oracle will oversee the app’s algorithm, data collection, and software updates.”

For background, TikTok’s online infrastructure in the US already has Oracle as its core. Microsoft is one of the other possible investors involved in the negotiations. Oracle already contributes significantly to TikTok’s operations by supplying a large portion of the server network that powers the app. Oracle would be more involved in keeping an eye on and managing the use of TikTok’s data and content as part of this possible agreement. This action is a component of a larger initiative to reduce Chinese ownership and influence over the well-known social media network.

According to one of NPR’s anonymous sources, the agreement aims to “minimize Chinese ownership” and would “effectively monitor and provide oversight with what is going on with TikTok.” The majority of TikTok’s backbone is already provided by Oracle’s server network.

Beyond the statement that it is “engaged in the talks,” Microsoft’s purported role is unclear. Microsoft co-founder Bill Gates referred to the company’s 2020 attempt to acquire TikTok as “a poison[ed] chalice,” and it was also in the running alongside Oracle and Walmart.

Although its precise position in the discussions is yet unknown, Microsoft is apparently participating. Microsoft attempted to buy TikTok in 2020 together with Oracle and Walmart, but the transaction fell through, when Trump approved this in his last administration. Walmart is not participating in the present discussions because of worries about the app’s projected and estimated worth. At present, the outcome of this latest takeover effort is yet unknown. 

Following President Trump’s executive order granting TikTok and others a 75-day respite from any enforcement action pertaining to the US demand that ByteDance sell from TikTok, news of the negotiations broke. In the past, Trump had hinted at the prospect of a “joint venture” in which the US would control half of the business.

In the TikTok’s legal disputes with Trump’s executive order, the talks follow President Trump’s executive decision that temporarily postponed any enforcement action over ByteDance’s TikTok divestiture. According to the decision, TikTok is barred from all legal action for 75 days. Trump had previously proposed a “joint venture” approach in which the United States would control 50% of TikTok, but the plan has not yet been completely implemented. Additional legal issues facing TikTok.

TikTok is involved in a number of other legal disputes in addition to the current discussions with Oracle. Concerns over national security and data privacy have prompted investigation of the app in a number of nations. Given ByteDance’s ownership, the US government is concerned that TikTok would provide the Chinese government access to user data. Other nations have also taken action against TikTok; because of identical concerns, India has banned the app completely. Lawsuits have also been filed against TikTok for how it handles user data, specifically with relation to protecting the privacy of children.

Further updates will be shared on this as Oracle, Microsoft, TikTok, and the White House take over.