Updated Sept. 14, 2020 8:59 pm
Oracle Corp. is one of the most lucrative but unflashy companies in Silicon Valley, a provider of business software and consulting services. Now, it is poised to become the U.S. partner for TikTok, the smash Chinese social-media app that has become a staple on the smartphones of millions of American teenagers.
The emergence of this oddball alliance is the latest twist in six weeks of negotiations that bear little resemblance to regular deal talks, driven by U.S.-China tensions, commercial rivalries and President Trump’s personal interventions.
TikTok parent ByteDance Ltd. confirmed on Monday it had submitted a proposal to the U.S. government that the Beijing company says would solve the Trump administration’s longstanding security concerns about a Chinese-owned app possessing the data on American users.
Details were scant, and many people close to the deal cautioned that much still needed to be decided and that it could still unravel.
The talks took multiple unexpected turns, and at various times drew in some of the biggest names in global business, including Walmart Inc. Twitter Inc. and Alphabet Inc.’s Google, and featured high-level political maneuvering.
Oracle isn’t believed to be getting a majority stake in TikTok, according to people familiar with the matter, despite Mr. Trump’s demand that it get sold. Instead, ByteDance’s plan involves a series of moves to address the national-security issues without having to either sell the U.S. operations outright or surrender the prized algorithms that power the app and make it so compelling to users, the people said. Some of the people also said Oracle would have access to view the algorithm’s source code and how it works.
Among other things, the ByteDance proposal will involve expanding TikTok’s U.S. offices to become the global headquarters and having Oracle certify the security of the app’s data, the people said.