TikTok’s Algorithm to Be Secured by Oracle Under Trump Deal

Oracle would provide security and help oversee the re-creation of a new US version of TikTok’s algorithm under a deal taking shape to sell the popular Chinese-owned app to a consortium of American investors, a White House official said, addressing a key concern raised by lawmakers in Washington.

The arrangement, outlined by the official on Monday, seeks to ensure that the American buyers control TikTok’s recommendation software in the US following a divestiture by its Chinese parent, ByteDance Ltd. Owners of the US-based TikTok would lease a copy of the algorithm from ByteDance that would then be retrained “from the ground up” with Oracle’s oversight, according to the official. Bloomberg News Technology Reporter Alexanda Levine joins Bloomberg Businessweek Daily to discuss.

Data from US users would be stored in a secure cloud managed by Oracle with controls established to keep out foreign adversaries, including China, the official said. Beijing-based ByteDance would not have access to information on TikTok’s US subscribers, nor would it have any control over the algorithm in the US, the official said.

The setup will allow Oracle to see how the algorithm is behaving while the new US TikTok entity operates and controls it, the senior White House official told reporters Monday.

The official downplayed the complexity of TikTok’s coveted recommendation engine, but it’s precisely that algorithm that has long been a complicating factor for any deal. The US law mandating a TikTok sale forbids ByteDance from any operational role in a new US app, including with the software. Chinese law, meanwhile, bars the export of such sensitive technology.

It’s unclear whether lawmakers who backed a qualified divestiture will accept the algorithm plan and whether the approach to fully disentangle TikTok from ByteDance is technically feasible. Oracle’s past work trying to secure US TikTok data under the companies’ partnership known as Project Texas was undermined by loopholes, part of the reason it was never formally approved by US regulators and adopted as a solution.

This time, under the deal, Oracle will work in partnership with the US government on a wide range of issues including algorithm retraining, application development and source code review, the official said. It wasn’t immediately clear what role the government might have in oversight of the app, its algorithm and user data.

Part of Oracle’s role in overseeing the US-based algorithm would be to “ensure improper manipulation is prevented,” the official said, without elaborating.

Details on the security guardrails emerged as President Donald Trump prepared to seal a long-awaited plan to sell the popular video-sharing platform to a consortium of American buyers. A sale would help Trump fulfill a campaign pledge while also removing a sticking point in US-China relations as the world’s two largest economies work to ease tensions over tariffs and export controls.

Trump intends to sign an executive order this week to formalize his approval of the transaction, the White House official said, adding that a number of regulatory reviews still need to be cleared on both sides.

Still, Trump expressed confidence last week that all parties were on board. “I had a great call with President Xi and as you know, and approved the TikTok deal, and we’re in the process,” he told reporters on Friday, hours after speaking with his Chinese counterpart, Xi Jinping. “We look forward to getting that deal closed.”

While Trump indicated that Xi had given his assent, the Chinese foreign ministry stopped short in a statement Friday of offering its full endorsement.

“The Chinese government respects the wishes of the company in question, and would be happy to see productive commercial negotiations in keeping with market rules lead to a solution that complies with China’s laws and regulations and takes into account the interests of both sides,” the ministry said.

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