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TikTok is officially freaking out as the clock winds down when the U.S. Government’s September 20th deadline shuts the door on TikTok if a sale isn’t made. They don’t want to sell their company and told Microsoft and Walmart to take a hike. Then they scrambled with a weird proposal to “partner” with Oracle on Sunday but not sell their company.
We’re now learning more about the Oracle deal. TikTok wants to appease the Trump administration with a deal to open a new U.S. business and hire 20,000 Americans. Oracle will be a data house to ensure that security issues are dealt with as required by the U.S. Government to safeguard consumer information from going to the Chinese Government. At present it still sounds like another stall to get to election day (or week) remaining in tact. That appears to be the ultimate short-term goal.
This news came in-part by way of the Washington Post that “TikTok offered to create a new U.S.-based company and add 20,000 jobs in a bid to win over U.S. government support for its proposal to address President Donald Trump’s security claims and keep its short-form video app operating in the country.”
Treasury Secretary Steve Mnuchin revealed a few details in an appearance on CNBC Monday morning, also corroborating that Oracle was involved in the proposal as presented in their video interview below.
Mnuchin stated that “I want to be careful what I say, but I will confirm we did get a proposal over the weekend that includes Oracle as the trusted technology partner, with Oracle making many representations for national security issues. There’s also a commitment to create TikTok Global as a U.S.-headquartered company with 20,000 new jobs.”
TikTok currently runs its U.S. operations from Culver City, Calif., just west of Los Angeles. The Washington Post previously reported that TikTok approached the administration with a mitigation proposal.
While Mnuchin didn’t go into detail about the proposal, people familiar with the talks who spoke on condition of anonymity to discuss them candidly told The Post that the proposed arrangement would allow its parent company ByteDance to retain ownership but outsource management of data to Oracle’s cloud-computing operations.
In a statement, TikTok spokeswoman Hilary McQuaide said, “We can confirm that we’ve submitted a proposal to the Treasury Department which we believe would resolve the Administration’s security concerns.” This is a far cry from TikTok recently stating that they would sue the government.
But Oracle’s close relationship with President Trump may have given it an upper hand, as it beat out Microsoft to work with TikTok. Oracle’s chief executive, Safra Catz, has dined at the White House with Trump and served on the president’s transition team after his election in 2016. Oracle co-founder and chairman Larry Ellison hosted a fundraiser for Trump this year.
Mnuchin said the administration “had a lot of confidence in both Microsoft and Oracle.”
Mnuchin would only say that “national security remains the priority, and that regulator will discuss the proposal with Oracle “over the next few days.”
Mnuchin added that “There has always been a critical factor for us, driving national security is making sure that the technology on Americans phones is safe and making sure that it is not corrupt.”