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Oracle confirms Bytedance-TikTok partnership in US

?The move ends weeks of speculation over which company Bytedance would strike a deal with in the US

Database specialist Oracle has confirmed that TikTok parent Bytedance has asked it to become a "trusted technology partner" to the video-sharing app.

The move ends weeks of speculation over which company Bytedance would strike a deal with in the US as it seeks to appease regulators and maintain TikTok's presence in the country.

What does it mean?

  • The full scope of this partnership hasn't yet been set out but will introduce changes designed to see off a threat by President Trump to shut down the platform at a minimum.

  • This will centre around the handling of user data amid concern that Beijing may have access to the personal information of 100 million American users.

  • Bytedance has strenuously denied such allegations, stressing that its servers are located in the US and Singapore and that it has employed 'extraordinary measures' to ensure privacy and security.

  • The fast-moving story has also seen the US division of TikTok contact the Treasury Department to ask if establishing a distinct US-headquartered company would satisfy concerns.

  • The Oracle tie-up follows the collapse of a potential Microsoft buyout yesterday after Bytedance snubbed its overtures.

What is TikTok saying?

  • TikTok has remained purposefully vague in its public pronouncements thus far, refusing to even utter the name Oracle.

  • TikTok must tread a fine line in its response amid concerns of its own that the US demands are politically driven.

  • Addressing the future obliquely, TikTok stated: "We can confirm that we've submitted a proposal to the Treasury Department which we believe would resolve the administration's security concerns."

Why does this matter?

  • A trade war between the US and China has focussed on the technology sector with firms such as Huawei and Tencent encountering new restrictions on conducting business in the US.

  • Bytedance has been handed a deadline of this week to conclude a deal. Beyond which American firms would be barred from engaging with the video-sharing app.

  • It would also have triggered a process by which TikTok must cede its US operations by 12 November.

  • TikTok has exploded in popularity across the west in recent months, drawing millions of Americans and Europeans with a diet of video-based pranks, dancing and lip-syncing

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