TikTok Signs Deal with Oracle, Silver Lake to Continue US Operations

TikTok has signed a joint venture deal with Oracle, Silver Lake, and Abu Dhabi-based MGX, allowing the company to maintain operations in the United States and avoid a ban threat over its Chinese ownership. According to an internal memo, TikTok CEO Shou Zi Chew told employees that the US joint venture will be responsible for US data protection, algorithm security, content moderation, and software assurance.

The consortium of new investors, including Oracle, Silver Lake, and MGX, will hold 50% of the US venture, with each having a 15% stake. Affiliates of existing ByteDance investors will own over 30%, while ByteDance retains just under 20%, the maximum allowed for a Chinese company under the law.

The deal is in response to a law passed under former President Joe Biden, forcing ByteDance to sell TikTok’s US operations or face a ban. US policymakers have warned that China could use TikTok to mine American data or exert influence through its algorithm.

The joint venture is expected to close on January 22, with Oracle serving as the “trusted security partner” responsible for auditing and validating compliance, including safeguarding sensitive US user data stored on Oracle’s cloud infrastructure in the United States.

Would you like to know more about the implications of this deal or the future of TikTok’s US operations?