Trump And Oracle's Dumb TikTok Cronyism Falls Apart

from the end-of-the-line dept

Remember when America spent a year and a half hyperventilating about a Chinese teen dancing app instead of securing American infrastructure from Russian hackers or other threats? Remember when a bunch of GOP officials with a long track record of not caring whatsoever about consumer privacy or internet security exploited xenophobic fears about the app to land political allies Oracle and Walmart a major windfall? Remember when 90% of the press couldn't be bothered to inform readers this was all performative cronyism by an unqualified nitwit? Good times.

This morning the Wall Street Journal announced that the much hyped deal to sell ByteDance-owned TikTok to Oracle and Walmart is looking unsurprisingly dead in the wake of previous legal challenges and Trump's election loss. Instead, the government appears poised to do what made sense from the start: focus on the broader problem of lax privacy and dodgy security standards across the board in telecom/adtech/tech, instead of singling out a teen dancing app:

"We plan to develop a comprehensive approach to securing U.S. data that addresses the full range of threats we face,” National Security Council spokeswoman Emily Horne said. “This includes the risk posed by Chinese apps and other software that operate in the U.S. In the coming months, we expect to review specific cases in light of a comprehensive understanding of the risks we face."

Again, this whole effort was about little more than Trump trying to gain leverage in a ham-fisted and unproductive trade war, while using the power of his office to hand over a successful business to his political buddies at Oracle and Walmart. Yet somehow, they managed to get the majority of the US technology press to believe this was some genuine, good faith effort to shore up consumer privacy. There were a few exceptions to this rule in press and policy circles, but they were the exception, not the norm:

Of course it was never really about security and privacy, since there's a parade of other more pressing issues Trump and the GOP clearly didn't care about. Trumpland opposed absolutely anything even resembling consumer privacy rules and standards for the internet era. It opposed funding improved election security. It clearly failed to secure US networks from hackers, and did little to nothing to shore up very real US security vulnerabilities be it the SS7 flaw or the dumpster fire that is the internet of broken things. They didn't genuinely care about internet privacy and security. They just didn't.

As such this wasn't just a failure for Trump, it was an immense failure for the US technology press, which successfully parroted Trump's claims that they were just really worried about consumer data privacy, despite zero evidence on any other front that this was actually true. While the Journal tries to feebly suggest that a deal could still be struck to sell TikTok, that doesn't seem likely. Instead the saga appears to be dying with a sad, quiet whimper, with the only winners being those who gobbled up the millions in billable legal hours to pursue this idiotic tech policy brain fart.

Filed Under: china, donald trump, larry ellison, performative nonsense, political theater, privacy, security theater
Companies: oracle, tiktok, walmart

The TikTok 'Deal' Was A Grift From The Start: Accomplishes None Of The Stated Goals; Just Helps Trump & Friends

from the a-joke dept

A week ago, we explained that the announced "deal" between Oracle and TikTok was a complete joke and what appeared to be a grift to let Trump claim he had done something, while really just handing a big contract to one of his biggest supporters. That was based on the preliminary details. As more details came out, it became even clearer that the whole thing was a joke. TikTok's investors actively recruited Oracle because they knew they needed to find a company that "Trump liked."

Over the weekend, Trump officially gave the "okay" on the Oracle deal (which now also involves Walmart). And before we get into the details of the deal and why it's a total grift, I'd like to just step back and highlight:

It is positively insane, Banana Republic, kleptocratic nonsense that any business deal should hinge on whether the President himself gives it a thumbs up or a thumbs down. Do not let all the insanity of this current administration hide this fact. If this had happened during the Obama administration, how crazy do you think Hannity/Carlson/Breitbart/etc. would be going right now about "big government" and claiming that the President is corrupt beyond belief? We should never, ever be in a situation where any President is giving the personal thumbs up or thumbs down to a business deal (and that's leaving out the fact that he forced this business deal in the first place with a blatantly unconstitutional executive order.

Okay, now back to the actual deal. Oracle and Walmart will team up to create a "new" (very much in quotes) company called TikTok Global that will be headquartered in the US. Of course, this is a joke. TikTok already has US operations. Oracle and Walmart will end up with a small equity stake in this "new" company (combined about 20%), but the Chinese company ByteDance will still own the majority of the company and will still control the TikTok algorithm. While there is some chatter about how the data will be hosted in the US, for the most part that was already true. Oracle says that it will review things to make sure that the data is secure, but remember, this is the same Oracle that collects a shit ton of data on internet users via Blue Kai, and then leaked it all. It's also the same Oracle that works closely with US spy agencies and isn't exactly known as being particularly good at security.

As the NY Times notes, this deal appears to accomplish literally nothing. As we said before, it was all performative, letting Trump claim he had "done something," when the rationale for the deal ("national security") was always bogus, and this is proved by the fact that nothing in the new setup changes whatever national security questions there were about the app before. So, rather than force ByteDance to "sell" the company to protect "US national security" as the NY Times rightly notes all that came out of this was:

A cloud computing contract for the Silicon Valley business software company Oracle, a merchandising deal for Walmart and a claim of victory for President Trump.

As former FCC chair Tom Wheeler tells the NY Times:

Vetting deals “is normally a process that involves multiple thoughtful people coming to the issue from multiple different concerns,” said Tom Wheeler, a former Democratic chairman of the Federal Communications Commission. “This appears as though what passes for process is what pleases one man: Donald J. Trump.”

Again, Banana Republic kleptocracy.

The NY Times also noted that Walmart either seemed to rush out its press release over the deal, or whoever wrote it had a heart attack in the process of composing it:

“This unique technology eliminates the risk of foreign governments spying on American users or trying to influence them with disinformation,” the company said. “Ekejechb ecehggedkrrnikldebgtkjkddhfdenbhbkuk.”

And that's not even getting into the whole issue of the mysterious $5 billion education fund. With the announcement, Oracle and Walmart said the new company would "pay $5 billion in new taxes to the Treasury," and then separately that it would "develop an educational curriculum driven by artificial intelligence to teach children basic reading, history and other subjects." Those two points got conflated to suggest that it was putting $5 billion into that project -- which sounded suspiciously like the finder's fee Trump demanded when first talking about forcing TikTok to be sold.

This got even more insane when Trump declared that he wanted the $5 billion to be used for his new 1776 history project, which is his new fascistic indoctrination education program, which Trump and his idiot followers insist is necessary because they falsely believe that kids are being indoctrinated to hate America (they're not -- they're just finally being taught, at least a little bit, that slavery is a key part of American history).

And the story got even more crazy when, after Trump talked about all of this, ByteDance came out with a giant shrug, saying it was totally unaware of any $5 billion education fund and appeared to have no interest in actually doing that.

It seems that most of the confusion was -- as per usual -- on the part of our not very intelligent President, who couldn't comprehend that the small education fund was different than the $5 billion, which is merely just estimate future tax revenues to the Treasury that, given the tax breaks this same President has helped set up, will probably never actually materialize.

It's like a clusterfuck of stupidity, corruption and kleptocracy. It's America in 2020.

Filed Under: banana republic, china, donald trump, grift, ieepa, kleptocracy, larry ellison, nonsense
Companies: bytedance, oracle, tiktok, walmart

The TikTok Oracle Grift: Insiders Admit They Went Hunting For A Tech Company The President Liked

from the because-of-course dept

Earlier this week we wrote about the absolute grift involved in the TikTok / Oracle deal. Contrary to the framing that this was Oracle "buying" TikTok to satisfy the President's unconstitutional demand that the Chinese company ByteDance sell TikTok to an American company, the story showed that this was just a hosting deal for Oracle's cloud service, which is way down the list of top cloud providers.

The end result was no actual sale (though the Treasury Department is still "reviewing" the deal), but a big contract for Oracle, and a bogus story in which the President can pretend he forced ByteDance to "sell" TikTok, even though it retains ownership in the company (there are some rumors that the hosting deal will include a small, and probably symbolic, equity stake for Oracle).

The other key point I noted in my article was that Oracle's executive leadership, starting with Larry Ellison, but including CEO Safra Catz, have been cozying up to Trump and the White House ever since Trump became President. While much of Silicon Valley's executive teams have made it quite clear how uncomfortable they are with a Trump Presidency, Oracle... has done the opposite. And while I framed it as being convenient that things worked out this way, a report from the Wall Street Journal highlights how this was the grift from day one.

Oracle was originally brought into the negotiations to provide an alternative to Microsoft Corp., a rival bidder with Walmart as a partner, said one person familiar with the talks. The U.S. investment firms Sequoia Capital and General Atlantic, which are existing investors in ByteDance, went in search of a tech company with close ties to the administration and settled on Oracle, the person said.

As we discussed earlier, from day one of this silly ordeal, the President made it clear he would steer a deal to a company he personally liked (meaning one where the leadership licked his boots, apparently). After all, after first saying that he was going to block TikTok in the US, as rumors of Microsoft's involvement came out, Trump immediately said that he would block a deal with Microsoft. Microsoft had to go grovelling to Trump over a weekend to have him say, grudgingly, they could continue to pursue a deal.

Then, of course, there's the Walmart story. Rumors came out that Walmart was a leading bidder, but Trump's White House stepped in and told them they would block that deal too, because it would show that Trump's figleaf "national security" explanation for banning TikTok was an obvious lie.

In other words, throughout this nonsense process, the President -- who at one point also demanded a finder's fee for any deal -- made it clear that this was about his own whims. He was forcing a sale, and he was going to pick a winner -- and the winner had to be someone he liked.

That doesn't seem like the kind of free market people appreciate. It seems like the very worst of a corrupt crony capitalist system.

The WSJ piece details how being corrupt this whole process was. It was all about stroking Trump's ego, and lining his campaign's bank account:

Sequoia Capital used its own connections to push the administration to allow TikTok to continue operating in the U.S., say people familiar with the discussions. Doug Leone, the firm’s global managing partner who took a lead role lobbying on TikTok’s behalf, has donated tens of thousands of dollars to Republican candidates this election season along with his wife, including to the president’s re-election campaign. Mr. Leone also held a reception at his Silicon Valley home for Secretary of State Mike Pompeo in January.

Ms. Catz’s relationship to Mr. Trump could give Oracle a leg up in getting the deal approved, according to people in contact with the White House. Oracle has worked for decades with the U.S. government, including multiple contracts with the national-security establishment.

Once again, this was nothing but performative nonsense from the President that ends in his own supporters lining their pockets. None of it seems to have anything to do with actual national security. It's a joke.

Filed Under: china, corruption, donald trump, doug leone, grift, larry ellison, safra catz
Companies: bytedance, microsoft, oracle, sequoia, tiktok, walmart

Oracle Doesn't Buy TikTok, But Gets A Lucrative Hosting Deal, And Trump & Friends Will Pretend This Means Something

from the art-of-the-grift dept

The TikTok saga, which was insanely stupid to begin with, kicked into overdrive last month when President Trump issued a blatantly unconstitutional executive order that was designed to force ByteDance to sell TikTok to an American company. We had all sorts of questions about this, but effectively ByteDance had until this week to find a buyer. While Microsoft was rumored for a while, late last night Microsoft announced that its proposal had been rejected and the only competitor left standing was... wait for it... Oracle. This led many to conclude that Oracle was buying TikTok. That is not the case. But hold on, we'll get there.

There was one other serious bidder: Walmart. Last night the company claimed it was still interested in buying TikTok, but the White House rejected that plan, because it would have made it totally obvious that the "national security" pretense for demanding the sale was obvious bullshit. Nope, the White House said: it has to be sold to a "tech" company, so that the White House can stand by its totally unsubstantiated by evidence claims that TikTok's dancing teens represented a national security threat.

So, with Walmart blocked, and Microsoft's deal not accepted, that left Oracle. But immediately the descriptions of Oracle's involvement were... weird. They very clearly did not say anything about "buying" TikTok. Instead, Oracle put out a very short press release saying that it will "serve as the trusted technology provider" to TikTok. That's not how you describe a sale.

This is a hosting deal.

Oracle will just host TikTok on its wannabe, way-behind-the-competition, cloud platform. And Trump and his cult-like supporters will pretend this actually accomplishes something. Oracle's executive suite has long been vocal Trump supporters, so this basically dumps a giant hosting contract into Oracle's lap. ByteDance will effectively still own TikTok, and Trump will pretend he's done something. For what it's worth, this is the second big Oracle cloud deal done in the last few months, with the previous one being with videoconferencing company Zoom.

As Russell Brandom over at the Verge notes, this deal "accomplished nothing." ByteDance still owns TikTok (and, according to reports, retains full control over TikTok's algorithm). As former Yahoo and Facebook Chief Security Officer Alex Stamos points out, literally none of the concerns people have raised about TikTok (most of which were bogus in the first place) are solved by an Oracle hosting deal:

As Stamos points out, accepting this deal would show that it's nothing but "pure grift," basically dumping a forced contract into Oracle's lap, a company which (again) has had an executive licking Trump's boots since day one.

And people can't even truly argue that Oracle will somehow make whatever little "private" data there is on TikTok "more secure." It's not like it was just months ago that an Oracle-owned subsidiary, BlueKai, leaked data that tracked users all over the web, exposing billions of records.

In other words, the whole thing was a joke. Like so much of this administration it was performative nonsense by Trump, who was mad that some kids made him look foolish on TikTok, combined with anti-Chinese racism, to push for a deal he had no legal right to push for, resulting in a weird scramble that doesn't accomplish what he wanted, but does shift a bunch of money to some of his vocal and wealthy supporters. The "Art of the Grift."

Filed Under: china, corruption, donald trump, grift, hosting, larry ellison, national security, security
Companies: bytedance, microsoft, oracle, tiktok

Fight Is On Between Oracle And Google Over Java API Copyrights

from the shouldn't-have-gotten-this-far dept

Last summer, we noted that there was an interesting "sideshow" in the patent dispute between Oracle and Google -- a question of whether or not Java's APIs are covered by copyright. That "sideshow" has become the main attraction now that the trial has started and many of the patent claims have been kicked out.

Oracle has been quite public with its argument (pdf), which is mostly based on taking snippets from Google emails that suggest a need to license Java. The favorite of the bunch is this one:

They also point to some snippets of code that do appeared to be copied:


If you just see that side of it, you might be convinced, but the details suggest a much less convincing story. First off, there are serious concerns about whether or not an API even can be covered by copyright. In fact, before Sun was acquired by Oracle, Sun's own CTO had said that "internet specifications are not protectable under copyright," which (you might think) gives Google an implied go ahead to make use of the API. Furthermore, many of the email snippets that Oracle presents are taken out of context -- they show little snippets of big emails and pull from very very different time periods -- ranging from 2005 to 2010, when different factors applied. Oracle also scrubbed a blog from former Sun CEO Jonathan Schwartz in which he warmly welcomed Google to the Java family when the company launched Android.

Perhaps more damning: Larry Ellison himself in 2009 at the JavaOne event spoke about Google's Android development and how they were contributing code back to Java. Ellison himself was put on the stand and appeared to contradict his own depositions when it came time to discuss the specifics of the copyright. That can't go over well. Not only that, but he stumbled, and claimed he was "not sure" when asked specific questions:

On cross-examination, Google came out firing and the room got tense quickly. “Do you understand that no one owns the Java programming language?” lead counsel Robert Van Nest asked.

Ellison began a longer answer, but Judge William Alsup interrupted him and said it was a “yes or no” question. Finally Ellison said, “I’m not sure.”

“And anyone can use it without royalty?” Van Nest followed up.

“I’m not sure,” Ellison said again.

Then Van Nest showed a video of Ellison receiving the same question on a deposition video and answering “That’s correct” to both.

Oracle's response, of course, will be that it just meant for developing apps, not for using the API -- but its other statements are a lot less clear on that. Either way, it seems pretty clear that Sun gave an implied open license to these things, so to come back now and insist otherwise is pretty questionable. Furthermore, there still are questions as to whether or not an API can actually be covered by copyright at all.

Separately, Oracle keeps talking about just how much work it is to create APIs, and even points to some Google statements about the difficulty of doing so. That's smoke and mirrors. Difficulty has no bearing on copyright law. It's kind of surprising that Oracle's lawyers would even bring it up, as "sweat of the brow" arguments won't get very far. Hell, even if it biases a jury, it would get rejected on appeal. It seems like Oracle's strategy here is just to confuse the jury and go for guilty by association because they're going to have trouble showing actual guilt.

As for the specific code snippets shown above, those a few lines out of 50,000 or so files. Under copyright there's a defense known as de minimis copying, if you're just found to have copied a very tiny portion of something. It seems like that might apply here as well.

Also, you may have heard stories about the results of this trial potentially being worth billions of dollars or something, but that was before most of the patents got thrown out. The patents left over aren't worth very much at all, and the end result means that if Oracle wins, it'll likely get less than $100 million. That's still a significant sum, but it's a lot less than what Oracle had hoped to get in this lawsuit.

In the end, as it seemed from the beginning, Oracle's case looks pretty weak (and getting weaker).

Filed Under: api, copying, de minimis, java, larry ellison
Companies: google, oracle, sun