As if 2020 wasn't weird enough, Oracle bought the US operations of TikTok, which makes no sense.

Except when it does.

Background 1

For some reason, the USA president thought a popular Chinese application should not operate on USA soil. So TikTok would be banned from USA internet.

Why? Dunno why, but probably for a trade war.

There was one chance for TikTok to continue working on USA: if it was operated by an American company.

Background 2

Oracle is famous for its databases. When someone says "Oracle", the mind of most developers jump to databases, either by its namesake or MySQL or SQLite12.

So, when the news of Oracle buying the TikTok operations in USA, that confused a lot of people, to the point of saying that it would accomplish nothing.

But it does. A lot. That's why we need more background.

Background 3

Oracle is also a player in a larger market called "Cloud Providers". This market is lead by Amazon with AWS, followed by Microsoft with Azure, then Google with Google Cloud Platform (GCP) and a mishmash of Huawei with Huawai Cloud and Oracle with Oracle Cloud.

One of the important things, marketing-wise, is who is using your product. You get a big player and you can use them as sort of endorsement.

AWS captures a lot of those, but most prominent are the Amazon Store itself and Netflix; Microsoft have the whole Office365; Google have Spotify. And, up to a few months, Oracle had nothing (Huawei have the whole Chinese market, so it is, basically, a player on its own).

Background 4

A few months ago, Zoom made a surprising announcement of taking Oracle Cloud as its provider. People were expecting this announcement saying something like Microsoft or even Google, but... Oracle? That was a huge surprise but, at the same time, it gave Oracle the leverage to say "the most used video conferencing software now runs on Oracle Cloud".

So, does it make sense?

Sure it does. Not in the technological point, although Oracle could profit with the knowledge of serving lots of videos over the internet for its own cloud operations, but it gives them another big name as sort of endorsement of its cloud service. "TikTok, powered by Oracle Cloud" is one hell of an advertisement.

And I think that's why it does accomplish a lot.

The biggest loser

When TikTok operations where on the table, Oracle wasn't the only one to get it: Microsoft was far away in talks with TikTok to be the USA operator of the service.

But besides that, Microsoft isn't the biggest loser in this sale of operations. Google is.

Remember when I mentioned that Google is considered to be in the third place in the cloud market? Now Oracle have Zoom and TikTok as endorsers and users of their services. And that could give a huge boost for Oracle Cloud, even if not by getting more customers or more profit, but the numbers from hosting those two services may give the impression they surpassed GCP.

It's all a marketing move. And a pretty clever one.


1

Yes, MySQL and SQLite are Oracle products.

2

NO! Not SQLite! Oracle bought Berkeley DB, which is mostly always available on Linux systems.