With Newer Doubts Creeping in the Tiktok deal & the power concerns on the forefront, is it still a silver lining for the U.S or just a darker cloud?
Times have been tough and countries are at crossroads trying to figure out ways that will ensure the safety and security of their assets, including data assets. Not long back, President Trump announced that the U.S will be alienating the famous-infamous Chinese video-social networking app, TikTok from the citizens of the U.S. keeping in mind the security concerns that come with it.
Soon after the announcement made headlines, the topnotch industry giants of the U.S., Oracle, Walmart, and Microsoft entered into a bidding war to acquire the U.S. control of TikTok. Oracle happened to surpass and win the deal.
Now, Oracle and Walmart together were said to gain control of the U.S operations of TikTok and form a new joint entity named “TikTok Global.” President Trump stated that Oracle will have complete control over TikTok Global, whereas ByteDance (the owner of TikTok) commented that it would hold 80% control of this new entity, which led to silence over conflicting views from both countries.
Present Climate –
Trump promised the country that Oracle will have all the control and China will be out of the picture. But ByteDance’s statement of having 80% control says otherwise. At present, there cannot be seen a definite future of TikTok in the States, as Trum said, “If we can save (TikTok), we will save it, if we can’t we will cut it off. We have to have total security.” So, it is uncertain as to whether or not the deal will go through, with both parties seeking major authority.
If the deal sees the light of the day and ByteDance holds 80% control over the operations and data of TikTok Global, the security concern that led to the emergence of the deal in the first place will still prevail. If ByteDance restraints control of the operations to TikTok Global operations, the data generated will be under the company’s purview, again inflicting the concerns to the security of data of around 100 million U.S users majorly comprising teens and 20-somethings. Flip side, the Chinese analysts and editors believe that the parent company (ByteDance) wouldn’t approve of anything else as it would endanger the national security, dignity, and interests of China.
Another angle to the deal is its ownership and stakes. Even though ByteDance has substantial U.S. owners in its stake, that still doesn’t mean total ownership for Oracle. The company will theoretically have to issue special voting shares to give Oracle the control over TikTok Global while owning 12.5% of the shares. Trump stated that he wouldn’t approve of the deal if found that Oracle doesn’t have full control. All the parties will have to figure out a way if they want this deal to actually play out.
It is still unclear whether TikTok Global will be controlled by Oracle and Walmart or ByteDance. Ministries of both the countries are looking into the matters and trying to come to a common ground.
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