Sunday, November 29, 2020

TikTok, Donald Trump and Oracle: small events with friends?

TikTok, the famous Chinese social network on borrowed time in the United States, intends to seal a “technical partnership” with software giant Oracle. A victory for the American group, which has long cultivated good relations with Donald Trump. This “proposal” will be studied this week by the US government, the US Treasury Secretary confirmed on Monday.

The TikTok saga in the United States ends, provisionally, as it began: in a very political tone and in economic and legal ambiguity. ByteDance, the Chinese parent company of the social network for video sharing, has turned down an offer to buy from Microsoft to merge with Oracle, the US software giant, which submitted an offer to it, the White House confirmed on Monday, September 14.

The US government will study this week’s “ByteDance” “proposals” to try to resolve the dispute on the successful TikTok platform. This will be examined “this week in the Cfius Committee”, which examines foreign investment in the US, says Steven Mnuchin, US Secretary of the Treasury. “Then we will make a recommendation to the president and discuss it with him,” he added.

But beware, this result does not mean that TikTok’s US operations will come under the Oracle banner. The American group will be just one “reliable technical partner” of the Chinese social network in the United States.

Far from Donald Trump’s demands

A reconciliation with much more vague outlines than the offer that Microsoft put on the table. ByteDance should retain control of the application, but let Oracle handle the data collected in the “cloud” [sur des serveurs en ligne, NDLR]”, thinks the Washington Post knows, referring to anonymous sources close to the negotiations between the two groups.

Such a solution would be light years away from Donald Trump’s demands. The White House tenant would have threatened to ban TikTok in the United States unless ByteDance ceded its U.S. operations to a U.S. buyer before September 20th. The Trump administration thus tried to cut the cable between the US social networking office and Beijing, for Washington suspected ByteDance of having the Chinese authorities consult the data collected on the 100 million US users of TikTok.

However, the agreement reached between Oracle and the Chinese group “does not address any of the national security issues raised by Washington”. assures, on Twitter, Alex Stamos, former Facebook security manager. ByteDance would retain control of its algorithm, which chooses what content is marketed to users, and this partnership “does not change the way TikTok works in the United States,” concludes Alex Stamos.

It is hard to imagine that the White House, in these circumstances, would at least approve of such a marriage. Especially since Donald Trump had already announced to Microsoft in July last year that he would not accept anything other than a buyout. And especially not a “technical partnership”, as Satya Nadella, CEO of Microsoft, suggested at the time, reminiscent of The Protocol Technical Information Website.

Oracles “Tump-o-Philie”

However, Oracle has an asset that Microsoft did not have. It is one of the few leading technical groups that politically supports Donald Trump. And from the beginning. Safra Catz, the group’s CEO, was part of the Republican candidate’s transition team after his 2016 victory as president. “I told the president that we will be with him and do everything we can to help him achieve this. Her goal”, she declared on December 11, 2016. The businesswoman had also been contacted for some time to become Donald Trump’s national security adviser.

The group’s leaders have since multiplied the gestures of goodwill towards the White House. In March, when the president pushed for the adoption of hydroxychloroquine, the controversial treatment for malaria, to combat Covid-19, Oracle jumped at the chance to provide technical support for a major study to test the effectiveness of this drug.

Oracle has also recruited several lobbyists close to members of the president’s entourage, such as Matt Schlapp, husband of Mercedes Schlapp, strategic adviser to the Donald Trump re-election campaign team.

Safra Catz and JeffreyO. Henley, Oracle VP, has, also gave $ 130,000 and $ 55,000, respectively to fund the outgoing president’s campaign against Democrat Joe Biden. Finally, in January last year, Larry Ellison, the charismatic founder of Oracle, had organized a fundraiser for Donald Trump, who publicly declared on this occasion his political flame to the Republican politician.

This assumed that “Trump-o-philosophy” has made it possible for Oracle to be one of the only giants in Silicon Valley that has never drawn up the White House’s anger, the Financial Times recalls. The group also has the rare privilege of having two seats in advice on “resumption of the economy” after the Covid-19 pandemic.

But a green light for the rapprochement between TikTok and Oracle would illustrate “how much clientelism has grown in importance in US economic policy under Trump”, Judge Jasmin Mujanovic, a political scientist and specialist in issues of crisis in democratic regimes, on Twitter. A “technical partnership” between the Chinese social network and the US business software star “actually makes” no economic sense “, Judge Brent Thill, an analyst at investment bank Jefferies, was interviewed by the Financial Times. The American group has built up its fortune in the tough business world and has no experience of managing a social network for young people driven by viral videos, this expert continues.

If Donald Trump accepts the terms of a partnership he refused to Microsoft, it would mean for former Facebook security chief Alex Stamos that all the talk about the dangers of TikTok “was just a big scam” for Oracle to win the jackpot in the end. It does not matter if this deal is economically meaningful or if it neutralizes the risk that TikTok poses to US national security.

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