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Over the weekend, Donald Trump gave his “blessing” to the deal Bytedance, the father of TikTok, had forced himself with Oracle, as he put it. From his point of view, the TikTok Global company to be established then will be “a completely new company. It will have nothing to do with China.”
The US president also surprised with the statement that TikTok, Oracle and Walmart would transfer five billion dollars to an education fund in Texas, which should ensure “that the real history of our country is taught, not the false history.” A few days earlier, Trump had described an educational project for the New York Times magazine, which wants to give the subject of slavery a different status in school lessons, as “the twisting, distortion and corruption of American history.”
The majority group controlled by China, Bytedance, presented its point of view on Monday: The first point: TikTok’s global business will continue to operate as a subsidiary. There are “rumors” that the majority will be in the hands of American actors.
The US side calculates like this: Oracle and Walmart want to acquire 12.5 percent and 7.5 percent, respectively, of TikTok Global. Because the owners of Bytedance also include American investors, including General Atlantic and Sequoia Capital, the majority of TikTok Global will be in American hands. Bytedance puts it this way: “TikTok Global is a wholly owned subsidiary of Bytedance based in the United States. TikTok Global plans to start a small round of funding before the IPO. After funding, TikTok Global will become a subsidiary. of Bytedance, which owns 80 percent. “
That TikTok Global “will have nothing to do with China,” as Trump put it, is definitely wrong.
No control over TikTok code for Oracle
Second, Trump’s statement about paying five billion dollars in Bytedance sounds different: TikTok Global will probably have to pay that sum in the form of taxes in the US, but first for several years and in second, it’s just a “Forecast”. That has nothing to do with the deal between Oracle and Walmart.
Third, TikTok’s algorithms played a significant role in the negotiations, which among other things determine which videos are recommended to users in what order. They are considered the heart of TikTok. Bytedance is now holding back expectations regarding future control over it: So far, there are no plans to deliver algorithms in the deal with Oracle and Walmart. Oracle has been given “permission to review the source code for TikTok USA. Viewing the source code is a universal solution for multinational companies to alleviate concerns about the security of local data.”
The Chinese government had previously tightened its export regulations and stipulated that “IT technologies with personalization based on data analysis” and operation with artificial intelligence can only be sold abroad with its permission. The TikTok algorithms should also fall within this definition.
According to the “New York Times,” a statement from Walmart, which was later amended, brought the chaos to the point. Initially it said: “This unique technology eliminates the risk that foreign governments may spy on US users or influence them with disinformation. Ekejechb ecehggedkrrnikldebgtkjkddhfdenbhbkuk. The jumble of letters could have been a placeholder that was later removed.
With material from Reuters
