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Bytedance will not sell TikTok’s US operations to Microsoft, the US tech giant said in a statement, with reports that it chose instead a consortium led by Oracle as a “technology partner.”
ByteDance has been in talks to sell the American TikTok business since Donald Trump threatened last month to ban the service if it didn’t sell. The president’s executive order in August gave Americans until Sept. 15 to stop doing business with the video platform’s Chinese parent company, ByteDance, or it would shut down in the U.S. Effectively, it set a deadline for a possible pressured sale by the technology company to a US bidder.
The Washington Post reported that Oracle had been chosen by ByteDance as a “technology partner” to allay US concerns, and Reuters quoted a source as saying it would be a restructuring rather than a sale, with Oracle handling user data. Americans from TikTok. The source did not disclose how much of the US operations of TikTok, ByteDance and their investors would continue to own.
ByteDance will need approval of the deal from both Washington and Beijing. It’s unclear whether Trump, who wants a US tech company to own most of TikTok in the United States, will approve the proposal.
ByteDance and Oracle did not immediately respond to requests for comment. The White House declined to comment.
Microsoft said on its blog on Sunday that Byte Dance would not sell it TikTok’s operations in the United States, even though the company was “confident that our proposal would have been good for TikTok users, while protecting the interests of TikTok. National security”.
“To do this, we would have made significant changes to ensure that the service meets the highest standards for security, privacy, online safety, and the fight against disinformation, and we made these principles clear in our August statement.”
Retail giant Walmart, which had been engaging in negotiations with Microsoft, still had an interest in a TikTok investment and was still in talks with ByteDance leadership and other parties, Reuters reported.
“We know that any approved deal must satisfy all regulatory and national security concerns,” Walmart said.
On Monday, the South China Morning Post said that ByteDance would not sell or transfer the algorithm behind TikTok in any sale or divestment deal, citing an informed source about the discussions in the Chinese company’s boardroom and citing new controls over Chinese government export.
In late August, Beijing issued new restrictions or bans on technology exports, requiring companies to seek government approval, a process that can take up to 30 days.
The rules, which had not been updated since 2008, were believed to be aimed at delaying the sale of TikTok to American buyers.
Some technologies were removed from the list of regulated exports, including vaccine technologies, but the 23 new additions included technology related to artificial intelligence interfaces, speech recognition, and content recommendation analysis.
TikTok’s short videos include everything from hair coloring tutorials to dance routines and jokes about everyday life. It has been downloaded 175 million times in the US and more than 1 billion times worldwide.
Trump has claimed that China could use TikTok to track the location of federal employees, create files on individuals to blackmail, and conduct corporate espionage.
The company has said it has never provided US user data to the Chinese government, and Beijing has criticized Trump’s crackdown as policy.
The US measures come ahead of the Nov. 3 election in which Trump, who is behind rival Joe Biden in polls, has been campaigning with an increasingly strident message against Beijing.
