Oracle emerges as a key player in TikTok’s U.S. deal, but security concerns over ByteDance persist.

Negotiations concerning TikTok’s operations in the U.S. and Oracle appear to be an important player are reportedly underway as revealed by a recent report from Politico. Vice President JD Vance and National Security Advisor Mike Waltz are negotiating the deal on behalf of President Donald Trump. However, concerns about ByteDance, the Chinese parent company, and the potential risks posed by its algorithm still exist.

The proposed arrangement ensures that management of American user data by Oracle, preventing any backdoor access by the Chinese government. Conversely, experts warn that this may not eliminate security risks unless TikTok's algorithm is overhauled or ByteDance is kept out of operational reach.

The initiative follows 2023's “Project Texas”, wherein TikTok enabled Oracle to review its algorithm and content moderation system to alleviate some national security concerns. However, on 19 January 2024, Congress passed a law demanding the sale of TikTok by ByteDance; that deadline passed without a deal, temporarily shutting down the app.

President Trump stopped the prohibition upon taking office, and ultimately delayed it until April 5, giving ByteDance more time to find a new owner. Since then, Oracle has been a potential buyer, and Trump recently has mentioned that four companies are interested in buying.

Apart from concern for national security, TikTok also influences business and commerce. Research finds that nearly 80% of millennials and Gen Z consumers look for financial advice via social media, while Gen Z is 117% more likely to purchase whatever the influencers promote revealing the economic significance of TikTok.