Mar 20, 2024 - News

TikTok's Austin angle

Animated illustration of the TikTok logo glitching and turning into a no symbol.

Illustration: Brendan Lynch/Axios

A high-profile data security project at Austin-based Oracle is in jeopardy as lawmakers in Washington contemplate forcing TikTok to split from its Chinese-owned parent company.

Why it matters: The $1.5 billion initiative with Oracle was meant, in part, to stave off just this sort of action by Washington.

Catch up quick: Democrats and Republicans raised national security concerns over TikTok's Chinese-owned parent company ByteDance, alleging the Chinese Communist Party could influence app operations or control software on American mobile devices.

  • If signed into law, a bill passed last week by the U.S. House would require TikTok to split from ByteDance within 180 days or be banned in U.S. app stores.

Flashback: To address security concerns, TikTok began routing all U.S. user data through Austin-based tech company Oracle in 2022. The initiative is dubbed Project Texas.

  • The Oracle cloud prevents U.S. user data from being accessed by either TikTok or ByteDance employees, TikTok public policy vice president Michael Beckerman wrote in a letter to Congress.

Yes, but: If ByteDance is forced to sell, another parent company is unlikely to "continue this expensive, groundbreaking work," Beckerman said.

  • "Ironically, U.S. user data could be less secure under a divestment scheme," he added.

The other side: "TikTok is an enormous threat to U.S. national security and young Americans' mental health," U.S. Rep. Michael McCaul, a Republican who represents parts of North and West Austin and western Travis County, said in a statement.

Of note: Oracle didn't return an Axios request for comment.

What's next: The Senate has indicated it will move slowly on the measure, and Texas' Republican senators have been noncommittal about their planned vote.

What John Cornyn and Ted Cruz say


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