Microsoft's not buying TikTok after all
Oracle has been appointed TikTok's "trusted tech partner" in the U.S., but the company won't be sold.
After weeks as the presumed frontrunner to acquire TikTok's operations in the U.S. and elsewhere, Microsoft said on Sunday that it's not happening after all. That makes Oracle now the clear favorite and the only official bidder left, but this acquisition has only gotten more complicated over time.
Here's Microsoft's full statement: "ByteDance let us know today they would not be selling TikTok's US operations to Microsoft. We are confident our proposal would have been good for TikTok's users, while protecting national security interests. To do this, we would have made significant changes to ensure the service met the highest standards for security, privacy, online safety, and combatting disinformation, and we made these principles clear in our August statement. We look forward to seeing how the service evolves in these important areas."
The announcement came exactly a week before the September 20 deadline set by President Trump, as he sought to force ByteDance to sell the company's U.S. operations to an American company. As that deadline got closer, the deal got more complicated: China made clear that it could prevent a sale that included TikTok's algorithm, then on Sunday the South China Morning Post reported that it would do just that. China also said last week that it would rather TikTok be shut down in the U.S. than sold under the current conditions.
Going forward, there seem to be two options left for TikTok: Sell to Oracle, a deal that has plenty of both cultural and technological questions, or shut down in the States? A third option would be for Trump to extend the acquisition deadline, though he said last week he won't do that.
On Sunday night, The Wall Street Journal reported that Oracle would be announced as TikTok's "trusted tech partner" in the U.S. but that the company wouldn't be sold. What that means is not exactly clear, but Oracle handling and managing all TikTok user data in the U.S. could solve a version of the White House's issue with the app. (Though Trump has said this is the kind of deal he didn't want.)
Oracle's Larry Ellison certainly has the ties to Trump necessary to help get a deal like this through, but China holds a lot of leverage in the deal and appears happy to play saboteur.