Trump signs TikTok deal

A national-security divestiture just doubled as a political reward. On Thursday, President Donald Trump is set to sign an executive order that deems the TikTok agreement a “qualified divestiture,” extending enforcement of the 2024 law while handing operational oversight to Oracle and majority ownership to U.S. investors. For Larry Ellison, that’s not just a contract. It’s leverage.

What’s actually in the deal

The structure is unusually tight. Oracle will host the data of TikTok’s 170 million U.S. users, review the code, and monitor the recommendation system’s behavior on an ongoing basis. ByteDance’s stake falls just under 20 percent, while a consortium anchored by Oracle and financial backers takes roughly 80 percent. The algorithm won’t be “transferred” so much as copied and retrained on American data, with Oracle auditing the result.

The White House will also grant another 120-day extension to complete the carve-out. And, according to multiple reports, the U.S. government is expected to receive a multibillion-dollar transaction fee—echoing Trump’s earlier push to collect a “very large percentage.” Critics call it a finder’s fee for power.

The claim vs. the risk

Officials argue the arrangement ends foreign control while preserving the app Americans use. The catch is technical. There is no real precedent for licensing a social-feed algorithm at scale, retraining it on a new corpus, and keeping engagement intact. Even Meta’s Reels and YouTube’s Shorts—built by world-class teams with massive data—took years to approximate TikTok-style pull. This could work. It could also drift. Fast.

Lawmakers see the ambiguity. House China Committee Chair John Moolenaar has warned that a licensing scheme risks “ongoing reliance” on ByteDance’s technology, potentially violating the spirit—if not the letter—of the law. If the U.S. board oversees operations but the core ranking logic remains a derivative of ByteDance’s system, who truly controls the feed?

Ellison’s advantage: infrastructure as power

Ellison’s win is less about content than plumbing. Oracle Cloud doesn’t write the headlines; it decides how the headlines move. By owning the hosting, code review, and algorithm oversight, Oracle gains operational visibility that traditional media owners never had. It’s the quiet kind of control—beneath the UI, inside the scheduler, next to the model weights.

That control sits on top of a broader compute play. Oracle already houses Nvidia’s DGX Cloud and has served as overflow for OpenAI training runs. The company has spent heavily to become indispensable to AI customers who need low-latency, GPU-dense clusters. The TikTok mandate fits that arc: not just another proof point for Oracle Cloud, but a long-term, highly visible workload that reinforces the company’s pitch to every AI-at-scale buyer.

Cross-platform consolidation, family edition

Then there’s the media map. David Ellison now runs Paramount Skydance, home to CBS News. He’s also been floated in reporting around potential bids for Warner Bros. Discovery assets, including CNN. Pair that with Dad’s TikTok oversight, and the family’s influence stretches from short-form feeds to prime-time broadcasts.

In practice, that creates a smooth conveyor belt: a package airs on CBS, the best 35 seconds get clipped and tuned for TikTok, performance data loops back into assignment meetings, and anchors push follow-ups that ride the algorithm’s lift. None of this requires a memo about ideology. It’s just efficient distribution—until it’s not.

How the deal was brokered

This was not a market auction. White House negotiators curated the investor roster and the operating rules. Names floated in and around the bid—Oracle, Silver Lake, Susquehanna (co-founded by major Trump donor Jeff Yass), Michael Dell, even the Murdochs—trace a pattern: capital plus proximity. ByteDance didn’t pick these partners; Washington did.

That curation is itself a precedent. A divest-or-ban statute intended to reduce foreign influence has yielded a structure that concentrates domestic influence among political allies. There’s no neat FCC rule for “algorithmic cross-ownership,” and antitrust doctrine never anticipated a world where the most consequential newsroom is a ranking function.

What success would look like

If the algorithm performs and users don’t churn, the White House will claim victory: national security protected, platform saved, and a clean on-ramp to a U.S. IPO. Oracle gets a marquee reference customer, TikTok’s U.S. team keeps operating, and creators keep their audience. Markets like continuity. So do advertisers.

But success will tempt coordination. A CBS investigative series finds traction on TikTok; the app’s policy team flags “borderline” critics; a scheduling tweak nudges reach during an election window. Each move is defensible in isolation. The sum is downstream power over civic attention.

The failure modes

Three failure paths stand out.

👉 First, quality decay: the retrained model under-delivers, content discovery feels off, and teens move to whatever’s next.

👉 Second, governance gridlock: the seven-member board splits along political lines, stalling policy decisions during crises.

👉 Third, backlash risk: journalists and creators perceive subtle favoritism, and the “Ellison empire” frame hardens, spooking advertisers and inviting regulatory payback in a future administration.

There’s also the unresolved legal edge case: if licensing looks like “cooperation” with ByteDance, expect immediate litigation from hawks who want a clean severance.

Bottom line

This is not the Murdoch model or the Musk model. It’s an Ellison model: own the pipes, audit the algorithm, and let the content fall in line. If it works, it rewrites how political capital, cloud contracts, and media distribution reinforce one another. If it falters, it will be because engineering reality refused to bend to Washington’s design.

Why this matters

• Market power meets message power: An owner with presidential access now spans TikTok’s feed mechanics and a national broadcast network, concentrating influence across the discovery stack.
• Licensing as loophole: If “copy-and-retrain” passes legal muster, future divestitures may favor politically connected infrastructure providers rather than open competition.

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