TikTok Transfers US Operations to Oracle-Led Investor Group in Major Shift

TikTok signed a deal on December 18 to spin off its U.S. operations to a group of investors led by Oracle, a software giant controlled by billionaire Larry Ellison, a close ally of former U.S. President Donald Trump. The agreement marks a significant shift in the company's ownership structure, with the new investor group set to oversee the app's algorithm and content moderation rules in the United States. According to the deal, TikTok's U.S. algorithm will be retrained to only use data from American users, and content moderation rules will be set by the new investor-controlled entity. However, the underlying algorithm will still be owned by Beijing-based ByteDance, the parent company of TikTok, with the approval of American auditors. This arrangement has been confirmed by an internal TikTok memo reviewed by NPR and two sources familiar with the deal who were not authorized to speak publicly. The deal is seen as a compromise between the U.S. government and ByteDance, which has faced scrutiny over its ties to the Chinese government and concerns about data privacy. The agreement is also a significant win for Oracle, which has been working to expand its presence in the technology sector. "This is a major step forward for Oracle and our efforts to bring more American ownership and control to the U.S. operations of TikTok," said a spokesperson for Oracle in a statement. The deal has significant implications for the tech industry, as it sets a precedent for the ownership and control of U.S. operations by foreign companies. It also raises questions about the role of American auditors in overseeing the data collection and usage practices of foreign-owned companies operating in the United States. TikTok's U.S. operations have been under scrutiny since 2020, when the Trump administration launched an investigation into the company's ties to the Chinese government. The company has faced criticism over its data collection practices and concerns about the spread of misinformation on the platform. The deal is seen as a way to address these concerns and ensure that TikTok's U.S. operations are more transparent and accountable. The deal is expected to be finalized in the coming months, pending regulatory approval. Once completed, the new investor group will take control of TikTok's U.S. operations, including its algorithm and content moderation rules. The deal is seen as a significant development in the tech industry, and its implications will be closely watched by regulators, investors, and users alike.