Oracle confirms deal with TikTok to be 'trusted technology provider'

Oracle confirms deal with TikTok to be 'trusted technology provider'
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Oracle on Monday confirmed a deal with TikTok's parent company, ByteDance, to become a "trusted technology provider."

The proposed arrangement was submitted to the Treasury Department over the weekend.

Oracle's confirmation of the previously reported deal comes just ahead of the deadline for divestiture set by the Trump administration in an executive order.


Treasury Secretary Steven MnuchinSteven Terner MnuchinLawmakers fear voter backlash over failure to reach COVID-19 relief deal United Airlines, unions call for six-month extension of government aid House Democrats plan to unveil bill next week to avert shutdown MORE told CNBC Monday morning that the government plans to review the deal this week.

“I will just say from our standpoint, we’ll need to make sure that the code is, one, secure, Americans’ data is secure, that the phones are secure and we’ll be looking to have discussions with Oracle over the next few days with our technical teams,” he said.

A spokesperson for TikTok confirmed that the proposal was submitted, which "we believe would resolve the Administration's security concerns."

"This proposal would enable us to continue supporting our community of 100 million people in the US who love TikTok for connection and entertainment, as well as the hundreds of thousands of small business owners and creators who rely upon TikTok to grow their livelihoods and build meaningful careers," they told The Hill.

Details about what Oracle's role as a "trusted technology provider" would mean in practice have not yet been shared.

The justification for Trump's executive order was the nebulous national security threat posed by TikTok's parent company being based in China.

It is unclear how this proposal, which does not seem to constitute a sale, would assuage those concerns in any meaningful way.


Even if Oracle were to take over American operations, it appears that ByteDance would still theoretically have access to user data and be able to manipulate its algorithm to push political messages. TikTok already claimed that no user data was sent to China.

Microsoft, the other major bidder for TikTok, hinted at those concerns in a statement confirming their offer had been rejected Sunday night.

“We would have made significant changes to ensure the service met the highest standards for security, privacy, online safety, and combatting misinformation,” the company said in its statement. “We look forward to seeing how the service evolves in these important areas.”

Critics have already raised concerns about the potential deal.

“A deal where Oracle takes over hosting without source code and significant operational changes would not address any of the legitimate concerns about TikTok,” former Facebook security chief Alex Stamos said on Twitter, “and the White House accepting such a deal would demonstrate that this exercise was pure grift.”

Oracle and the administration have a number of close ties.

Oracle co-founder Larry Ellison, whom Trump called a "tremendous person" Tuesday, hosted a fundraiser for the president earlier this year.

Safra Catz, Oracle's CEO, was part of Trump's transition team in 2016 and was reportedly floated to join his cabinet.

The company's D.C. top lobbyist, Ken Glueck, was also on Trump's transition team.

A successful deal would undoubtedly be a boon for Oracle.

TikTok has been nearly 200 million times in the U.S., according to data provided to The Hill by SensorTower, and provides an entry point to the coveted youth market for Oracle.

Updated: 12:41 p.m.