China-based ByteDance subsidiary TikTok is nearing a deal under which US-based Oracle will store user information for US users. The deal will ensure its parent company cannot access the data.
In August 2020 the Committee on Foreign Investment in the United States (CFIUS) ordered ByteDance to divest its ownership of TikTok, citing concerns US user data could be passed on to China’s communist government.
Although the Biden administration has not sought to enforce the order, the move appears intended to head off potential future action.
Oracle had discussed acquiring a minority stake in TikTok in 2020, when ByteDance was under US pressure to sell the app.
TikTok is one of the world’s most popular social media apps, with more than 1 billion active users globally. The information of US users is currently stored in TikTok data centers in Virginia, with a back-up in Singapore.
The US has been increasingly scrutinizing app developers over the personal data they handle, especially if some of it involves US military or intelligence personnel.
Chinese gaming company Beijing Kunlun Tech Co Ltd was forced to sell its popular gay dating app Grindr in 2020 after CFIUS approached it with national security concerns.
ByteDance is one of China’s fastest growing startups. It owns the country’s leading news aggregator, Jinri Toutiao, as well as TikTok’s Chinese counterpart Douyin.
- Reuters, with editing by Neal McGrath
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