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ORPresident Donald Trump wants to win again: he demands that TikTok be owned by Oracle, a California technology company that is closely related to him. Trump’s Threat: If the video-sharing app remains at its Beijing-based parent company, it will be banned in the US.
Now you may have to settle for less. In any case, the offer made by the Chinese to the US government last weekend does not foresee an immediate sale. It’s unclear if that will be enough to allay America’s security concerns.
China controls the TikTok algorithm and therefore has access to the data of around 100 million US citizens. The Chinese government has just shown its power again by vetoing Chinese companies that abandon intellectual property, such as TikTok.
Trump wants to show toughness towards China
The president must now decide whether to accept the offer and approve a purely technical collaboration between TikTok and Oracle. If it rejects the deal, TikTok will have to cease operations in the United States next Sunday, as ordered by the president in August.
The exact terms of the deal were still unclear on Monday, but US Treasury Secretary Steven Mnuchin is already promising thousands of new jobs in the United States. It is also questionable whether the US Department of the Treasury can receive “compensation” for making TikTok’s business possible in the United States. That is what Trump had asked for. A successful deal would have a high priority for the president: After all, he is campaigning to prevent China from becoming a world power.
“Trump wants to be tough on the Chinese and he doesn’t want to back down from the threat of a ban. In a way, he set a trap, “says Paul Triolo, a long-time government analyst and now head of the geotechnical department at consulting firm Eurasia Group, in an interview with” Politico. ”
At the same time, President Xi Jinping’s Chinese government does not want to allow Washington to “simply force it to sell a large and important Chinese technology company,” Triolo said. That is not a problem that can simply be “magically removed”. “The details of the deal should make sense to both parties,” says the analyst.
Acquisition as the only chance of survival for TikTok
Republican Senator Josh Hawley, a Trump ally, is urging the administration to “immediately reject” the proposal. Because with this solution, concerns of China controlling the application are not ruled out. “The TikTok software must first be completely out of the control of the Chinese Communist Party,” demands Hawley. “Any association that allows for something else is completely unacceptable,” he says. TikTok itself denies any dependence on the Chinese government. The app does not transmit any data to Beijing.
Oracle and TikTok operator ByteDance has yet to release any details about the potential deal. They only confirmed on Monday that they had submitted a proposal for the future of TikTok to the US government and are now waiting to see if Trump will give them his blessing.
According to sources in China, this could be difficult. Trump will likely accept nothing more than an acquisition. Last Thursday, he told reporters that the company had two options: “Either we shut down TikTok in this country, or it will be sold.”
Supporters of the Chinese hardliners suspect that this stance is based on the assumption that TikTok users’ data is more secure with an American company. As long as these doubts about data protection are not dispelled, Trump will not agree.
“If the offering to Oracle doesn’t meet these requirements, it really shouldn’t be implemented,” says Klon Kitchen, director of the Heritage Foundation’s center for technology policy. It is not about selling TikTok to an American company at any price. “The idea of selling was just one of the solutions to avoid a total ban,” says Kitchen.
Microsoft was interested in TikTok
Finance Minister Mnuchin explained the Chinese proposal Monday on the CNBC news channel, which is aimed at addressing security concerns. Among other things, TikTok would move its global headquarters to the US and create around 20,000 jobs. TikTok currently operates its business in the US from Los Angeles. The operators had previously committed to creating 10,000 jobs in the United States within three years.
The Committee on Foreign Investment in the United States, which analyzes the effects of trade agreements on national security, will review the proposed agreement later this week, according to Mnuchin, and make a corresponding recommendation to Trump. The Finance Minister stresses that data protection remains a priority. “We will hope to speak with Oracle in the next few days,” he says.
The agreement with Oracle was only known on Sunday. Software maker Microsoft had previously tried to buy TikTok. He had been in talks with ByteDance since the beginning of the summer and then also made an offer to take over TikTok’s operations in the United States. Microsoft CEO Satya Nadella spoke with Trump in early August to convince him of the benefits of this solution. But TikTok ultimately refused.
A few days later, after speaking with Nadella, Trump had issued the decree that forced ByteDance to cease its operations in the United States as of September 20. He is concerned about ByteDance’s ties to the Chinese government. Later, the president signed another ordinance giving the company 90 days to sell TikTok to a US company, provided the US government approves the deal.
Oracle could be an opportunity for TikTok
When negotiations between ByteDance and potential buyers were in full swing, the Chinese government in turn issued new regulations. The Commerce Department included certain algorithms and the type of artificial intelligence that TikTok uses on an export control list.
That means: the Chinese government must approve every sale of such products. Since then, state media has repeatedly pointed out that China will not support a forced sale of TikTok to a US buyer. The Chinese government has yet to comment on whether or not it has approved the new agreement with Oracle. ByteDance itself states that “they will strictly adhere to Chinese regulations.”
In any case, in Washington, the solution would bring a great advantage: ByteDance has chosen a partner at Oracle who has no qualms about ingratiating himself with the Trump administration. When other Silicon Valley heavyweights had long since minimized contact with Trump, Oracle bosses became close allies of the president and pushed his re-election campaign forward.
Oracle’s billionaire president Larry Ellison held a fundraiser for Trump at his Rancho Mirage, California home in February. CEO Safra Catz donated $ 125,000 for the president. This can be read in the campaign finances.
Before TikTok, Trump was targeting Huawei
Whatever Trump’s decision, the deal should be seen as part of the major political and economic tensions between China and the United States. They dominated Trump’s entire tenure in office and provided reliable fodder for hate speech in the current election campaign.
The president has described a trade deal with China as a key success for his government. He has blamed Beijing for America’s failure in the face of the corona pandemic, and has repeatedly referred to Covid-19 as the “China virus.”
“I have worked harder than anyone before me so that China does not continue to steal jobs from Americans,” Trump said Sunday night at a rally in Nevada and struck out at Democratic challenger Joe Biden. “Biden’s agenda is made in China, my agenda in America,” Trump said.
The main reason he attaches such importance to the TikTok deal is that he views the ties between Chinese tech companies and the local government as a threat to national security. For the same reason, Trump has banned Chinese telecom giants Huawei and ZTE from US cellular networks and urged Americans not to use Chinese devices for 5G connections. On August 6, it issued a regulation prohibiting business with the WeChat messaging app, owned by the Chinese state-owned company Tencent.
“The US government is enforcing regulations against Chinese companies,” said Samm Sacks, an expert on Chinese cybersecurity policy and the Chinese digital economy at New America, a Washington-based think tank. He suspects: “The closer the November elections are, the more sanctions there will be against Chinese companies.”
Translated by Celine Schäfer
This article comes from a cooperation with “Politico”. Click on these links, exit welt.de and access the articles on politico.eu.
