Well … it was useless.
After debasing the idea of free trade in the United States in the name of a misplaced security concern, lining up several multi-billion dollar companies that have embarrassed themselves in the interest of pure greed and demanding that the U.S. government get a profit reduction, the TikTok The saga we’ve been watching over the last few weeks seems to have finally ended.
A flurry of announcements late Saturday night indicates that the TikTok deal was in fact a political-oriented shakedown to boost the cloud infrastructure business of the President’s top supporters.
Oracle, whose cloud infrastructure services are a quarter ridiculous compared to AWS, Alphabet * and Microsoft, will acquire a 20% stake in TikTok along with partner Walmart in what will be an investment round before TikTok Global (as the new entity will be called ) goes public on an American stock exchange.
According to a statement from TikTok, Oracle will become TikTok̵
Meanwhile, Oracle indicated that all concerns from the White House, the US Treasury, and Congress about TikTok had nothing to do with Oracle’s service selection as a cloud provider. In its statement, Oracle said that “This technical decision by TikTok was strongly influenced by Zoom’s recent success in moving much of its videoconferencing capacity to Oracle Public Cloud.”
Here’s how CNBC reporter Alex Sherman dismantled the ownership structure, for “a person who is familiar with the matter. Oracle gets 12.5%, Walmart 7.5% and ByteDance the remaining 80%. The Trump administration says US investors will own 53% of TikTok because ByteDance (TikTok’s parent) is backed by venture capitalists who hold a 40% stake in the parent company.
The deal benefits everyone but US consumers and people who have real concerns about the security of TikTok’s algorithms and the ways they can be used to influence opinion in the US.
TikTok’s parent company ByteDance manages to keep ownership of the US entity, Oracle gets a huge new cloud customer to scale up its ailing business, Walmart gets access to teens to sell stuff, and US customer data isn’t safer (it is only now in the hands of US Predators instead of foreign ones).
To be clear, data privacy and security are a major concern, but not necessarily a concern when it comes to TikTok (and furthermore, the Chinese government has probably already captured all the data it wants on US customers).
For many observers, the real concern for TikTok was that the Chinese owners of the company might be pushed by Beijing to manipulate its algorithm to promote or suppress content. Businesses in China, including its internet giants, are required to follow the country’s cloud intelligence and security law which requires full compliance with all government orders for data.
The Commerce Department said in its statement that “In light of recent positive developments, Secretary of Commerce Wilbur Ross, under the direction of President Trump, will delay the ban on transactions identified under Executive Order 13942, on enforcement mobile TikTok which would have gone into effect Sunday 20 September 2020 until 27 September 2020 at 23:59 “So it’s a week off.
So all this sound and fury … for what? The best return on investment in all of these scams is almost certainly Oracle co-CEO Safra Catz ” investments in Trump, who in addition to being a major donor to the Trump administration, also joined the presidential transition committee in 2016. Thank God the US saved TikTok from China’s crony capitalism. Let’s just hope they appreciate Washington DC’s crony capitalism.
* An earlier version of this article referred to AWS, Amazon, and Microsoft. AWS and Amazon are the same company. I was typing fast. I corrected the error.