Exclusive-TikTok is nearing an agreement with Oracle to store its data sources

FILE PHOTO: In this photo illustration a TikTok logo is displayed on a smartphone
FILE PHOTO: In this illustration dated January 6, 2020, a TikTok logo is displayed on a smartphone. REUTERS/Dado Ruvic/

March 10, 2022

By Echo Wang and David Shepardson

(Reuters) – TikTok is nearing a deal for Oracle Corp to store its US users’ information without Chinese parent company ByteDance having access to it in hopes of addressing concerns from a US national security body over data integrity in the popular short video App People familiar with the matter, said.

The deal would come a year and a half after the United States Committee on Foreign Investments (CFIUS) ordered ByteDance to divest TikTok amid fears that US user data could be leaked to China’s communist government.

That order wasn’t enforced after Joe Biden replaced Donald Trump as US president last year, but CFIUS still has concerns about data security at TikTok that ByteDance now wants to address, the sources said.

It’s not clear if CFIUS will determine that TikTok’s partnership with Oracle will resolve identified national security issues, the sources said. A spokesman for the US Treasury Department, which chairs the CFIUS, did not immediately respond to a request for comment.

Oracle had been talking about acquiring a minority stake in TikTok in 2020 when ByteDance was under US pressure to sell the app. The cloud computing giant will store all of TikTok’s US user data on Oracle data servers as part of the new proposed partnership, the sources said. Some of TikTok’s data is currently stored in Alphabet Inc.’s Google Cloud.

According to the sources, as part of the agreement, a dedicated US data stewardship team will be established to act as a gatekeeper for US user information and shield it from ByteDance. The companies are discussing a structure where this team is not under TikTok’s control or oversight, the sources added.

TikTok is also exploring partnerships with other tech companies over firewalls and cyber security measures, the sources added.

ByteDance and Oracle did not immediately respond to requests for comment.

TikTok is one of the world’s most popular social media apps with more than 1 billion active users worldwide. US users’ information is currently stored in TikTok data centers in Virginia, with a backup in Singapore.

The United States is increasingly screening app developers for the personal data they process, particularly when some of it pertains to US military or intelligence officials.

Chinese gambling company Beijing Kunlun Tech Co Ltd was forced to sell its popular gay dating app Grindr in 2020 after CFIUS approached them with national security concerns.

ByteDance is one of the fastest growing startups in China. It owns the country’s leading news aggregator, Jinri Toutiao, as well as TikTok’s Chinese counterpart, Douyin.

(Reporting by Echo Wang in New York and David Sheparson in Washington DC; Editing by Greg Roumeliotis) Exclusive-TikTok is nearing an agreement with Oracle to store its data sources


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