How crazy an idea is Oracle buying TikTok?

The Big Story

Renegades unite

Whenever a 43-year-old database company gets a chance to buy a stake in a fast-growing social media property that's almost completely irrelevant to its core business strategy but will make the most powerful man in the world like it even more then, obviously, it's gotta take it.

Quick recap, because a lot's happened: Following a threat to ban TikTok in the U.S., President Trump last week ordered TikTok parent company ByteDance to sell its U.S. operation within 90 days to a bidder subject to approval by CFIUS. There are only a few tech companies on Trump's nice list, and Oracle co-founder Larry Ellison runs one such company.

• Microsoft has already made public its interest in some of TikTok's operations, including the versions of the app run in the U.S., Canada, Australia and New Zealand.
• Now Oracle is said to be a bidder for those assets, working in conjunction with current TikTok shareholders Sequoia Capital and General Atlantic, according to the Financial Times. Trump appeared to confirm Oracle's interest Tuesday afternoon.
• The FT report contains this telling sentence: "It is unclear whether the White House is more supportive of Oracle's approach than that of Microsoft."
• Ellison, who has hosted fundraising events for Trump's campaign and is a big fan of dubious COVID-19 treatments such as hydroxychloroquine, is easily Trump's biggest fan in Silicon Valley, and vice versa.

Put aside the chummy relationship between a cantankerous billionaire and a man who played a cantankerous billionaire on television: What might Oracle actually do with TikTok?

• TikTok's fast-growing service would help prop up Oracle's fledgling cloud infrastructure business, and its artificial intelligence algorithms could also improve Oracle's technology in this extremely competitive space.
• It's amazing how often this is overlooked in any discussion involving Oracle, but the company runs one of the world's leading data broker operations, and TikTok users generate massive amounts of data that advertisers would love to have access to.
• Even a partial stake in TikTok could pay handsomely down the road at a time when Oracle's core businesses are struggling. (Don't forget that Oracle's enterprise tech conglomerate was assembled over years of ferocious M&A activity; the company is well versed in the art of the deal and would surely only sign off on something that makes a lot of sense.)
• Also, never underestimate Ellison's interest in spiting the competition: Denying Microsoft Azure a chance to host TikTok counts as a win.

It's quite possible that Oracle's bid is just a distraction, a planted headline to get Wall Street buzzing and to force Microsoft to cough up more than it might have otherwise planned were it the sole bidder.

But there's also a more troubling possibility: that Oracle's involvement is a preview of what tech deal-makers can expect during a possible second term for the Trump administration.

• Don't forget that Trump has insisted that any deal involving TikTok result in the U.S. Treasury getting a cut, perhaps the most shocking public provision attached to a potential tech merger in recent history. While much of the tech industry recoiled at the idea, Oracle remained silent.

And an Oracle-Trump union does make a lot of sense. After all, former enterprise sales executive Tom Siebel once compared Oracle's business tactics in the 1990s to another controversial Republican president: "This is the Richard Nixon school of software marketing," he said, describing Ellison's desire to destroy his company.

In 2020, maybe it's the Donald Trump school of tech takeovers.

Join us on Sept. 1

Edge computing is an emerging concept that holds great promise. AI best practices are still evolving in the cloud. Join us on Tuesday, Sept. 1 at 9 a.m. PT / noon ET to further understand edge computing, how it will change the way modern business applications are built, and why AI processes will have to be conduced at the edge. Speakers to be announced. This event is presented in partnership with Intel.

Register here.

This Week in Protocol

Virtual balloons: How do you pull off a national convention over the internet? "No one has ever done what we are going to do here," said Andrew Binns, chief operating officer of the Democratic National Convention Committee, describing the work that took place behind the scenes on a project that makes the challenges of remote working seem very small.

Creative firewall: Despite owning Twitch, the ESPN of modern video gaming, Amazon has struggled to make a name for itself in the gaming world. Perhaps that's because its gaming executives report up into AWS, a structure intended to highlight the power of AWS' virtual gaming infrastructure but one that walls off the extremely creative world of video game development from Amazon's other creative businesses such as Amazon Studios.

Five Questions For...

Vint Cerf, vice president and chief internet evangelist, Google

What was your first tech job?

I worked as a systems engineer for IBM from 1965 to 1967 running the Interactive, QUIKTRAN time-sharing system that allowed users to compose and run programs in FORTRAN. Early days for commercial time sharing.

What's the best piece of advice you could give to someone starting their first tech job?

Learn everything you can; don't be afraid to take some (technical) risks. Of course, don't do stupid things if you can avoid them!

What was the biggest reason for the success of cloud computing over the past decade?

Dynamic capacity expansion, improved security and global Internet access. A need to modernize technology infrastructure, optimize costs and prepare for the future. The pandemic has also accelerated cloud adoption. We have seen significant transformation over the past six months. More so than any other period in the past decade alone.

What will be the biggest challenge for cloud computing over the coming decade?

Providing universal authentication of identity correlated across users, devices and services, even over untrusted networks. Also a stronger focus on data confidentiality and isolation, which will see security frameworks like Confidential Computing come to the fore.

Will the pandemic usher in a new era of remote working, or will we all come back together when it is safe to do so?

Virtual meetings, remote collaboration, flexible hours: These new ways of working are here to stay. Almost certainly, some jobs will continue to be undertaken remotely. Employers will be more tolerant of working from home. Offices may adapt by increasing the number of shared workspaces for people who do NOT work in the office all the time. Of course, sanitary practices to facilitate that will evolve such as regular UV treatment of offices and work spaces. Finally, remote learning will persist, partly to accommodate larger classes covering much broader physical spaces.

Around the Cloud

• A virtual edition of Kubecon kicked off Tuesday after the pandemic forced organizers to cancel the European event scheduled for late March. IBM's Red Hat unveiled a new version of OpenShift designed for edge computing at the event, and AWS announced that its managed Kubernetes service now runs on its new Graviton2 Arm chips.
• Facebook joined the Linux Foundation at the highest level, following a long history of open-source contributions to both software and hardware.
• Chips were also in focus this week at the Hot Chips virtual conference, where Intel unveiled a new transistor-manufacturing technology that it presumably hopes will help people forget how its current manufacturing technology woefully lags behind the competition.
• IBM's Power processors have lost a little luster as Arm server processors have gained traction, but IBM thinks the Power10 design will offer enough performance to convince potential users to rewrite their software for the chip.
• It was another rough quarter for Cisco, as companies with the cash to consider upgrading their infrastructure technology in 2020 opt for cloud providers rather than traditional data center gear.
• Rackspace just went public again around a new strategy of helping companies migrate to AWS, and AWS has noticed: Reuters reported that Amazon is in talks to take a minority stake in the company.
• Been thinking about playing with quantum computers? AWS' Braket service is now generally available for testing algorithms and getting a general sense of how quantum computing will work, though actual production cloud services are still far off in the future.
• Google is notorious for walking away from internet services it thinks have passed their prime, which is a big red flag for enterprise customers. Steve Yegge uncorked a trademark rant explaining why Google needs to figure this out if it wants to be a serious cloud player.
• Penn State followed Indiana's lead from earlier this year by announcing that it will drop Box as a storage provider in favor of Microsoft's OneDrive and Sharepoint.
• Mozilla's recent layoffs affected part of its Rust team, but the fast-growing programming language will be getting its own foundation to help pick up the slack caused by the lack of a major corporate sponsor.
• Now we're waiting another month for the Department of Defense to issue its updated stance on the JEDI contract, Kelly McCormick at Federal News Network wondered if the DoD will have taken advantage of the delays to understand that it can't "lift and shift" workloads to the cloud.