NEW YORK • Oracle Corp confirmed yesterday that it was part of a proposal made by TikTok parent ByteDance to the US government to become a technology partner of the Chinese firm.
In a statement, the firm said "it is part of the proposal submitted by ByteDance to the Treasury Department over the weekend".
Earlier, people familiar with the matter said Oracle had beat Microsoft in the battle for the US arm of TikTok with a deal structured as a partnership rather than an outright sale to try to navigate tensions between Beijing and Washington.
US Treasury Secretary Steven Mnuchin yesterday said the Trump administration had received a proposal from Oracle over the weekend to make TikTok a US-headquartered company, and will review the plan this week.
"We have a lot of confidence in both Microsoft and Oracle. They've chosen Oracle. We'll be reviewing it with their technical teams and our technical teams to see if they can make the representations" to keep data on American phones safe, Mr Mnuchin told CNBC television.
ByteDance had been in talks to divest the US business of its hugely popular short-video app to Oracle or a consortium led by Microsoft after US President Donald Trump ordered the sale last month and said he might otherwise shut it down.
While TikTok is best known for dancing videos that go viral among teenagers, US officials are concerned user information could be passed to China's government.
TikTok, which has as many as 100 million US users, has said it would never share such data with the Chinese authorities.
The data is currently stored in Alphabet Inc's cloud.
Sale negotiations were upended when China updated its export control rules last month, giving it a say over the transfer of TikTok's algorithm to a foreign buyer.
Reuters reported last week that China would rather see TikTok shut down in the United States than allow a forced sale.
Yesterday, China's state-run English television channel CGTN cited sources as saying ByteDance would not sell TikTok's US operations to Oracle or Microsoft, and would not give the source code for the platform to any US firm.
It is unclear whether Mr Trump, who wants a US technology firm to own most of TikTok in the country, will approve the deal. The Committee on Foreign Investment in the US, which reviews deals for national security risk, is overseeing the ByteDance-Oracle talks.
Regulatory lawyer John Kabealo, who is not involved in the talks, said: "User data protection and assurances around how the company's algorithms push content to US users are thoughtful components of a substantive solution, but whether they can change political outcomes is a much more difficult question."
China's foreign ministry spokesman Wang Wenbin declined to comment yesterday when asked about the deal, but said TikTok was being "encircled" and "coerced" in the US into a transaction.
"We urge the US government to provide an open, fair, just and non-discriminatory environment for foreign firms operating and investing in the United States," he said.
REUTERS, BLOOMBERG
