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+++
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title = "The Hidden Value of TikTok"
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date = 2020-09-15
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[taxonomies]
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tags = ["thoughts", "tiktok", "oracle", "cloud"]
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+++
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As if 2020 wasn't weird enough, Oracle bought the US operations of TikTok,
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which makes no sense.
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Except when it does.
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<!-- more -->
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## Background 1
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For some reason, the USA president thought a popular Chinese application
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should not operate on USA soil. So TikTok would be banned from USA internet.
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Why? Dunno why, but probably for a trade war.
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There was one chance for TikTok to continue working on USA: if it was operated
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by an American company.
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## Background 2
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Oracle is famous for its databases. When someone says "Oracle", the mind of
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most developers jump to databases, either by its namesake or MySQL or
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SQLite[^1][^2].
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So, when the news of Oracle buying the TikTok operations in USA, that confused
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a lot of people, to the point of saying that [it would accomplish
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nothing](https://www.theverge.com/2020/9/14/21436035/tiktok-oracle-deal-bytedance-president-trump-safety).
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But it does. A lot. That's why we need more background.
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## Background 3
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Oracle is also a player in a larger market called "Cloud Providers". This
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market is lead by Amazon with AWS, followed by Microsoft with Azure, then
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Google with Google Cloud Platform (GCP) and a mishmash of Huawei with Huawai
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Cloud and Oracle with Oracle Cloud.
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One of the important things, marketing-wise, is who is using your product. You
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get a big player and you can use them as sort of endorsement.
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AWS captures a lot of those, but most prominent are the Amazon Store itself
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and Netflix; Microsoft have the whole Office365; Google have Spotify. And, up
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to a few months, Oracle had nothing (Huawei have the whole Chinese market, so
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it is, basically, a player on its own).
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## Background 4
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A few months ago, Zoom made a surprising announcement of taking [Oracle Cloud
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as its provider](https://www.reuters.com/article/us-oracle-zoom-video-commn-idUSKCN22A1R9).
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People were expecting this announcement saying something like Microsoft or
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even Google, but... Oracle? That was a huge surprise but, at the same time, it
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gave Oracle the leverage to say "the most used video conferencing software now
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runs on Oracle Cloud".
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## So, does it make sense?
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Sure it does. Not in the technological point, although Oracle could profit
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with the knowledge of serving lots of videos over the internet for its own
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cloud operations, but it gives them another big name as sort of endorsement of
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its cloud service. "TikTok, powered by Oracle Cloud" is one hell of an
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advertisement.
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And I think *that*'s why it does accomplish a lot.
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## The biggest loser
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When TikTok operations where on the table, Oracle wasn't the only one to get
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it: Microsoft was far away in talks with TikTok to be the USA operator of the
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service.
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But besides that, Microsoft isn't the biggest loser in this sale of
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operations. Google is.
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Remember when I mentioned that Google is considered to be in the third place
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in the cloud market? Now Oracle have Zoom and TikTok as endorsers and users of
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their services. And that could give a huge boost for Oracle Cloud, even if not
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by getting more customers or more profit, but the numbers from hosting those
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two services may give the impression they surpassed GCP.
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It's all a marketing move. And a pretty clever one.
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---
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[^1]: Yes, MySQL and SQLite are Oracle products.
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[^2]: NO! Not SQLite! Oracle bought *Berkeley DB*, which is mostly always
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available on Linux systems.
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