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ByteDance, the company behind the troubled Chinese short video sharing platform TikTok, has reportedly decided to reject Microsoft’s bid to become TikTok’s technology partner in the US and has decided to go with Oracle instead. ByteDance will also offload a significant stake to Oracle in the US.
Microsoft, in its official blog post, revealed that the Chinese company has decided not to sell “TikTok’s US operations to Microsoft.”
To recall, ByteDance had been given a September 20 deadline to announce its plan to sell off its local operations to a US company and complete the transaction by November 12. Failing to comply with this deadline would mean a complete shutdown of TikTok’s US operations.
Earlier, Oracle had emerged as a surprise contender to acquire the video-sharing platform TikTok and is said to have met the representatives of the company in the US. It was reported that Oracle is working closely with venture capital firms Sequoia Capital and General Atlantic for this bid. Interestingly, both these VC companies hold a stake in TikTok’s parent company ByteDance.
Both Oracle and TikTok have declined to comment on this development as per a report by CNBC.
Apart from the US, TikTok is facing similar struggles in India where it was banned along with 58 other applications of Chinese origin. Both the US and the Indian government decided to take stringent action against the company citing national security and privacy issues.
In a related report, ByteDance has decided not to sell or transfer the algorithm behind the immensely popular video sharing platform. According to a source briefed on the Chinese company’s boardroom discussions, ByteDance will let the U.S. technology team develop a new algorithm and the decision to not hand out the source code along with the sale of assets.