Walmart reportedly in talks to join Oracle's proposed stake in TikTok

2020/09/18 Innoverview Read

Walmart is expected to partner with Oracle on a deal with TikTok that could be approved in the next 24 to 36 hours, sources told CNBC. Walmart didn't immediately respond for comment, per CNBC. Previously, Walmart had teamed with Microsoft on a failed bid for TikTok as it sought to gain access to a platform that has potential in e-commerce and advertising, as part of its effort to keep pace with Amazon.

TikTok has selected Oracle as its "trusted technology partner" in the U.S., according to a statement issued by the enterprise technology solutions firm Monday. While details of the agreement, including whether Oracle will net TikTok's valuable algorithm, are scant, the announcement could be welcome news for brands and marketers that have been placing bigger bets on the popular video-sharing app in recent months.

The Trump administration is currently reviewing the deal, Treasury Secretary Steven Mnuchin told CNBC Monday morning. TikTok has faced mounting challenges from the president over its parent company ByteDance's ties to China, which has accelerated moves to buy parts of the business since early August, although an outright sale no longer seems to be in the cards, The Wall Street Journal reported over the weekend.

"Oracle confirms Secretary Mnuchin's statement that it is part of the proposal submitted by ByteDance to the Treasury Department over the weekend in which Oracle will serve as the trusted technology provider," Oracle's statement reads. "Oracle has a 40-year track record providing secure, highly performant technology solutions."

Oracle securing a partnership could allow TikTok to continue operating as usual in the U.S. for the near term, arriving just under the deadline of a ban. Crucially, it might fortify the app's standing and assure marketers that have seen the platform taken on a roller coaster ride in recent weeks.

"Even this small piece of certainty will provide a lot of reassurance to the whole ecosystem, from individual users to creators to brands, that there is a longevity plan and there won't be any disruption to services," said Evan Horowitz, CEO of creative agency Movers+Shakers, a firm focused on producing TikTok campaigns for brands like e.l.f. and NYX.

Finish line in sight

A representative for TikTok did not immediately respond to a request for comment. Meanwhile, Microsoft, once TikTok's top suitor, confirmed its bid was turned down in a company blog post Sunday.

"We are confident our proposal would have been good for TikTok's users, while protecting national security interests," Microsoft's blog post said. "To do this, we would have made significant changes to ensure the service met the highest standards for security, privacy, online safety, and combatting disinformation, and we made these principles clear in our August statement."

In August, President Trump issued an executive order that prevents U.S. entities from conducting transactions with TikTok starting Sept. 20, a maneuver that could effectively shut down the app's business. The president sees TikTok as a threat to national security and economic interests and has made unusual demands around a potential acquisition, such as suggesting the U.S. Treasury receive a "substantial" cut of any deal that's made. TikTok and ByteDance have repeatedly resisted accusations that they share sensitive personal data with Chinese authorities, and the former recently sued the Trump administration over the ban order.

(Source: Mobile Marketer )