Oracle, Michael Dell, named as investors in JV that will run TikTok's US operations
Big Red gets to store data, advise on security, and store the 'I'll watch just one more video' algo
Made-in-China social network TikTok has announced the formation of a joint venture that will run its US operations, the condition lawmakers required for its flagship app to continue operating in America.
The JV is called TikTok USDS Joint Venture LLC and has published an announcement that reveals it has three “managing investors,” namely software giant Oracle, private equity firm Silver Lake, and Abu Dhabi-based tech investment firm MGX. Each of those three holds 15 percent of the JV.
ByteDance, the Chinese company that runs TikTok elsewhere, owns 19.9 percent of the venture. Dell Family Office, Michael Dell’s investment firm, also invested in the JV.
Oracle will have a huge role in TikTok’s US operations, hosting American users’ data in its cloud and serving as the consortium’s “trusted security partner.” The latter role will see it assist with ongoing review and validation of source code.
The JV also plans to “retrain, test, and update the content recommendation algorithm on U.S. user data. “ The algo will be “secured in Oracle's U.S. cloud environment.”
The JV hasn’t said how much it paid for the privilege of operating TikTok in the USA, but hinted at how it will pay for it by revealing that it “will manage global product interoperability and certain commercial activities, including e-commerce, advertising, and marketing.”
The reference to interoperability is important, as the JV plans to ensure “U.S. creators can be discovered and businesses can operate on a global scale.”
One of the JV’s directors is TikTok CEO Shou Chew, a Singaporean national. The new entity points out that its seven-member board is “majority-American.”
The JV named two senior execs: CEO Adam Presser and chief security officer Will Farrell.
This deal has been a long time coming. US Congress passed a law forcing Chinese company ByteDance, TikTok’s owner, to find a US-based buyer by January 19th, 2025, or cease operations America. The law states its purpose as being “To protect the national security of the United States from the threat posed by foreign adversary controlled applications.”
President Trump nonetheless saw fit to extend the deadline for TikTok to find a buyer, and even said he had a “soft spot” for the app because it helped him to connect with young voters.
Trump on Thursday used his personal social media service, Truth Social, to share infographics detailing the size of his audience on TikTok. ®