How Oracle and a US-Led Group Will Control TikTok’s Algorithm and Safeguard US User Data

Oracle & US investors will oversee TikTok‘s US operations. Algorithm control shifts, addressing security concerns.
The Oracle corporate headquarters building with its distinctive blue glass facade The Oracle corporate headquarters building with its distinctive blue glass facade
The Oracle corporate headquarters in Redwood City, California, showcases its modern architectural design with a prominent blue glass facade. By Sundry Photography / Shutterstock.com.

Executive Summary

  • TikTok’s U.S. operations and its content recommendation algorithm will be overseen by Oracle and controlled by a new, American-majority ownership group to address national security concerns.
  • The new U.S. ownership group will receive a copy of the algorithm code, review and retrain it with U.S. user data, and Oracle will continuously monitor content presentation for U.S. users.
  • The deal, which President Trump is expected to affirm, involves a majority of American investors and is awaiting regulatory approvals, with formal completion anticipated early next year.
  • The Story So Far

  • The deal concerning TikTok’s U.S. operations and its algorithm arises from significant national security concerns that U.S. officials harbored regarding its Chinese parent company, ByteDance, and the potential for the Chinese government to access U.S. user data or manipulate the app’s content recommendation algorithm. This agreement directly addresses the ban-or-sale mandate previously issued by President Trump, aiming to resolve these risks by placing TikTok’s U.S. functions under American-majority ownership and oversight.
  • Why This Matters

  • This agreement resolves national security concerns by placing TikTok’s U.S. operations and a copy of its content recommendation algorithm under majority American ownership and Oracle’s continuous oversight, effectively allowing the popular app to continue operating in the U.S. while aiming to prevent foreign government manipulation. The restructuring means U.S. user data and content presentation will be locally monitored, though it could eventually lead to a separate application for American users.
  • Who Thinks What?

  • President Donald Trump and the U.S. government view the deal as a necessary step to address national security concerns, ensuring TikTok’s U.S. operations and algorithm are controlled by an American-majority ownership group.
  • ByteDance, TikTok’s parent company, has agreed to the deal, which involves transferring control of TikTok’s U.S. functions and a copy of its algorithm to a U.S.-based joint venture, while retaining a minority stake, allowing the popular app to continue operating in the U.S.
  • Oracle, whose chairman Larry Ellison has a close relationship with President Trump, will significantly expand its role by overseeing TikTok’s U.S. algorithm and continuously monitoring how content is presented to users.
  • TikTok’s algorithm and its U.S. operations are set to be overseen by Oracle and controlled by a new, American-majority ownership group as part of a deal aimed at addressing national security concerns. The agreement, confirmed by the White House, will transfer control of the popular app’s U.S. functions and a copy of its content recommendation engine to a U.S.-based joint venture, with formal completion anticipated early next year.

    Ownership Structure

    The new ownership group will feature a majority of American investors and be led by a majority American board of directors. Investors are expected to include Oracle and private equity firm Silver Lake, alongside existing U.S. and global firms invested in TikTok’s parent company, ByteDance, and a number of new investors. ByteDance will retain a stake of less than 20% in TikTok US.

    President Donald Trump indicated that tech and media leaders Michael Dell, along with Lachlan and Rupert Murdoch, might also join the new ownership group. However, a source clarified that Fox Corp. would be an investor, rather than the Murdochs individually. The full investor group is still undergoing finalization.

    Regulatory Path and Timeline

    The deal is currently awaiting formal regulatory approvals from China, though U.S. leaders have expressed confidence in its eventual completion. Trump is expected to sign an executive order affirming the deal as a qualified divestiture, as mandated by the ban-or-sale law, and will extend the enforcement pause for another 120 days. ByteDance is also anticipated to sign an agreement with one or more of the new investors, with formal completion likely early next year.

    Algorithm Control and Security

    The fate of TikTok’s algorithm had been a central question, given its critical role in the app’s popularity and the national security concerns surrounding it. U.S. officials had voiced worries that ByteDance could be compelled to manipulate the algorithm on behalf of the Chinese government. The ban-or-sale law specifically prohibits “any cooperation with respect to the operation of a content recommendation algorithm” between ByteDance and the new ownership group.

    Under the agreement, the new ownership group will receive a copy of the algorithm code, review it, and retrain it using U.S. user data. Oracle will then assume continuous monitoring of how content is presented to users. This control, however, will apply only to U.S. users, raising questions about whether American users might eventually need to download a new, separate application.

    Oracle’s Expanded Role

    This deal significantly expands Oracle’s existing partnership with TikTok. Oracle Chairman Larry Ellison has a close relationship with President Trump. Concurrently, Oracle announced changes to its executive leadership, with CEO Safra Catz stepping down to become vice chair of the board, and Clay Magouyrk and Mike Silica appointed as co-CEOs.

    Financial Considerations

    The White House has not yet finalized whether it will seek a fee for its role in negotiating the deal, which is projected to be worth billions of dollars. Officials have clarified that the White House will not hold a “golden share” or any other equity stake in the new company.

    Outlook

    The agreement represents a significant step in resolving the contentious debate over TikTok’s presence in the U.S., aiming to mitigate national security risks while allowing the popular platform to continue operating under American oversight.

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