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Rensselaer Polytechnic Institute (RPI)

Oracle and TikTok: Headache or Heady Deal?

Why is Oracle bidding for TikTok? Shyam Kumar, associate professor and director of the MBA program at Rensselaer Polytechnic Institute, sees it as a double-edged sword.

“This deal is a question mark from Oracle’s standpoint,” Kumar said. “They have benefitted by building strong ties with the Trump administration, and the deal is expected to allow them to host TikTok on their cloud servers, thereby strengthening their cloud presence.”

However, Kumar perceives there may be potential problems for Oracle in the deal. “First, it’s a foray into the consumer space, which is not Oracle’s core strength,” Kumar said. “They mainly service businesses. The arrangement also takes Oracle into the social media space, and drags them into the controversies bedeviling social media companies such as privacy, user exploitation, etc. Indeed, Oracle has been lobbying against their social media rivals, asking for legislation to make them more accountable. Now they will have to live up to the standards they have been advocating.”

According to Kumar, much depends on the details of the deal.

“It remains to be seen whether the deal protects U.S. consumer interests as strongly as the Trump administration would like,” Kumar said.

Kumar’s research focuses on the critical role of strategy in innovation, entrepreneurship, and competitive advantage. He can speak to the strategy background when companies take actions based on C-suite decision such as alliances, acquisitions, and product and international expansion.

Shyam Kumar:  https://lallyschool.rpi.edu/faculty/mv-shyam-kumar

 

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