The new TikTok deal is falling apart just one day after it was approved by Trump

TikTok’s future in the U.S. is now at risk once again as the newly minted deal between Oracle and Walmart is at risk of unraveling just one day after it was announced. Oracle has announced that TikTok’s owner ByteDance will have to divest its stakes in the U.S. based company TikTok Global, that would control the service.

The Redwood City-based company said in a statement, “upon creation of TikTok Global, both Oracle and Walmart will make their investment and the TikTok Global shares will be distributed to their owners, Americans will be the majority and ByteDance will have no ownership in TikTok Global.”

This statement contradicts the terms stated in the original deal, approved by U.S. President Donald Trump, where Oracle and Walmart would jointly claim a 20% investment stake in the new venture while ByteDance maintained an 80% stake in the service.

Oracle was to become TikTok’s “secure cloud technology provider” and it would take over the processing and storage of all U.S.-based TikTok users. Walmart was also working on a commercial partnership with TikTok.

The video-sharing platform narrowly avoided being banned when the U.S. Department of Commerce levied sanctions against TikTok and WeChat on Friday. That ban was delayed after Trump gave an informal approval of the deal struck over the weekend.

A U.S. judge then blocked the Commerce Department from requiring Apple Inc and Alphabet Inc’s Google to remove Chinese-owned messaging app WeChat for downloads.

In fact, the U.S. president was expected to formally withdraw the executive orders that blocked the app later this week, though these latest developments call that possibility into question.

Oracle, which has close links to the White House, seems emboldened by U.S. President Donald Trump’s statement on Monday where he made it clear that the deal was only possible if Oracle and Walmart had controlling stake in TikTok Global.

Prior to Oracle becoming the front-runner in the TikTok deal, Microsoft was slated to buy the video-sharing platform’s U.S. business. However, the Chinese government released new regulations in August that made it difficult to sell TikTok’s core technology without a license, and this booted Microsoft out of the race.

Could this latest development doom Oracle to the same fate as Microsoft? Stay tuned for further developments.

[SOURCE]

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