TLDR
- Oracle will completely rebuild TikTok’s algorithm for US operations under American control
- ByteDance retains less than 20% ownership while US investors control six of seven board seats
- All US user data will be stored in Oracle’s secure cloud systems with no Chinese access
- Trump plans executive order approval this week with 120-day deadline extension
- Deal includes major investors like Larry Ellison, Michael Dell, and Murdoch family
Oracle Corporation will create and manage an entirely new version of TikTok’s recommendation algorithm for American users as part of the Trump administration’s deal to transfer control of the popular video app from Chinese ownership to US investors.
The cloud computing giant will lease the existing algorithm from ByteDance and retrain it completely from scratch. This process addresses longstanding national security concerns about potential Chinese government access to American user data and content manipulation.
Under the agreement, Oracle will work directly with the US government on algorithm development, source code reviews, and ongoing security monitoring. The company will ensure the recommendation system remains free from foreign interference or surveillance capabilities.
US Investor Control and Ownership Structure
American investors will hold majority control of TikTok’s US operations through a consortium that includes Oracle founder Larry Ellison, Dell Technologies CEO Michael Dell, and Fox Corporation’s Rupert and Lachlan Murdoch. Private equity firms Andreessen Horowitz and Silver Lake Management also participate in the buyer group.
ByteDance will retain ownership of less than 20% to comply with federal divestiture requirements. The Chinese parent company gets one seat on the seven-member board but remains excluded from all security committee decisions.
Six board seats will be held by American representatives, ensuring US control over strategic decisions. This structure satisfies lawmakers who demanded complete separation from Chinese oversight of the platform’s operations.
Enhanced Data Security Measures
Oracle will store all US user information in secure cloud infrastructure designed to prevent foreign adversary access. The company’s existing Project Texas partnership with TikTok already handles some data storage, but the new arrangement expands this relationship significantly.
ByteDance will have zero access to American user data under the revised structure. Oracle will continuously monitor the algorithm’s performance and content recommendations to detect any manipulation attempts.
The security framework goes beyond previous proposals by completely rebuilding the recommendation engine rather than simply isolating existing code. This approach aims to eliminate any potential backdoors or hidden access points.
Government Approval Timeline
President Trump plans to sign an executive order this week formally approving the transaction. He will simultaneously extend ByteDance’s divestiture deadline by an additional 120 days, following his earlier 90-day extension.
Chinese government officials have expressed cautious support for business negotiations conducted under market rules and Chinese law. The Ministry of Commerce indicated China hopes for fair treatment of Chinese companies operating in America.
Congressional lawmakers who supported the original TikTok ban legislation promise careful scrutiny of the algorithm arrangements. Some representatives remain concerned about potential ongoing Chinese influence through ByteDance’s minority ownership stake.
Trump discussed the deal framework with Chinese President Xi Jinping during a recent phone conversation. Both leaders expressed confidence that all parties support moving the transaction forward to completion.
