TikTok has possibly avoided a ban in the United States as President Trump has agreed to a deal “in concept.”
The deal sees Oracle and Walmart claiming a 20 percent investment stake in a new company called TikTok Global, which will run TikTok’s operations in the U.S.
Oracle would act as the secure cloud provider and handle American data, while Walmart would use its e-commerce and advertising technology for the social media platform.
The U.S. Commerce Department has delayed the potential ban on TikTok to September 27th to allow for the deal to be finalized.
TikTok Global will be headquartered in the U.S. President Trump has noted that TikTok Global will hire up to 25,000 people and contribute $5 billion USD (about $6.6 billion CAD) to U.S. education.
“We are pleased that the proposal by TikTok, Oracle, and Walmart will resolve the security concerns of the US Administration and settle questions around TikTok’s future in the US,” a TikTok spokesperson said in a statement to The Verge.
Walmart has said that there is still work to be done before the deal is finalized, but notes that it has tentatively agreed to purchase 7.5 percent of TikTok Global.
Further, Oracle has noted that it will become a minority investment in TikTok and will be the social media giant’s “secure cloud technology provider.”
“We are a hundred percent confident in our ability to deliver a highly secure environment to TikTok and ensure data privacy to TikTok’s American users, and users throughout the world,” Oracle CEO Safra Catz said in a press release.
It’s still unknown whether the Chinese government has approved the potential deal.