Amazon (Nasdaq: AMZN) and TikTok Is Brilliant, Oracle (Nasdaq: ORCL) Not So Much

By Douglas A. McIntyre Published Apr 28, 2:46PM EDT

Key Points

Amazon (NASDAQ: AMZN) is a frontrunner to acquire TikTok’s U.S. operations, offering strategic benefits through user data, advertising reach, and potential e-commerce integration.
Oracle (NYSE: ORCL) is also in consideration, likely seeking AI or cloud synergies, though its strategic fit appears less compelling than Amazon’s.
A TikTok acquisition would enhance Amazon’s competitive position against Chinese e-commerce rivals and open a high-growth media and ad platform segment.

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Amazon (Nasdaq: AMZN) and TikTok Is Brilliant, Oracle (Nasdaq: ORCL) Not So Much — © 24/7 Wall St

24/7 Wall St. Key Points:

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Transcript:

[00:00:04] Doug McIntyre: So the president has pushed back once again, the timeframe for when TikTok is sold.

[00:00:11] Doug McIntyre: The Chinese don’t wanna sell it. Nope. Because one of the parts of the deal is usually you’d have to have access to the Chinese algorithm feeds people more and more of what they want. the president obviously wants to see it sold. He doesn’t want to be on his watch that the thing goes away. two companies keep coming up.

[00:00:35] Doug McIntyre: Public companies in the United States keep coming up as potential. Buyers of all, or part of, I’ll just call it TikTok, USA right one, Amazon, which I get, I, get the Amazon angle. I totally get that. The Oracle Larry Ellison’s angle. I don’t quite get that unless he thinks that there’s a big cloud computing or AI, piece of that deal that helps his top line in some way.

[00:01:05] Doug McIntyre: So the Larry Ellison Oracle thing, I don’t get the Amazon thing. If they can get it at any reasonable prices, brilliant. I mean, they then get access to about 150 million. TikTok accounts in the United States. And if you’re an online retail, who doesn’t want that?

[00:01:24] Lee Jackson: Oh, absolutely. Think about even if you’re a small guy, which is even more of a reason, if Amazon is the owner, and, of course they’ll say, Hey, all TikTok retailer advertises.

[00:01:39] Lee Jackson: Hey TikTok, that, that was Amazon calling me right there saying we want it, bad. but when you think of the retailers that, permeate online business, think of the added revenue Amazon could generate from that, from their retail product line and from the money they make, dispersing that retail.

[00:02:05] Lee Jackson: ’cause a lot of it goes through, other channels, for smaller retailers. But hey, if you’re big enough, getting your stuff on AWS and all through that system could be another huge plus for them.

[00:02:22] Doug McIntyre: Well, they’d also be buying a Chinese company that would help them compete with these online Chinese retailers.

[00:02:30] Lee Jackson: Right.

[00:02:30] Doug McIntyre: Undercut Amazon

[00:02:32] Lee Jackson: of the nation. Or the world.

[00:02:34] Doug McIntyre: What you’d be doing is you’d being buy, buying Chinese to fight the Chinese and that’s not a bad side reason for doing this deal.

[00:02:44] Lee Jackson: No, it’s not. And it’ll be interesting if they do cut it out, like you said, Doug. I mean, does it have to be TikTok, USA?

[00:02:52] Lee Jackson: And it’s only here, or is it everywhere, or is it TikTok? China’s different from TikTok, USA, and there’s a lot of social media that’s banned in China, so I don’t even know how it actually plays there. But yeah, I mean, they don’t wanna let it sold, but they don’t want to have to go to the TikTok.

[00:03:13] Lee Jackson: People who I’m sure the Chinese government get a ton of money from, and they need it. I’m sure they don’t wanna see it. Totally go to zero.

[00:03:23] Doug McIntyre: Well, the other part of this is you rarely see a business deal that’s being run by the president of the United States. No, you don’t. Well, it’s another example of where tariffs have an effect on individual US businesses.

[00:03:38] Doug McIntyre: President has to be looking at the fact that if he strategically maneuvers this Right, it could be very helpful to him. Oh, absolutely. I think he’s looking at this saying, I’ve got a tariff problem with China. I’ve got people in the United States who wanna buy TikTok. So the whole thing with Chinese tariffs is very muddy, and this makes muddy muddier.

[00:04:06] Lee Jackson: Yep. And again, there’s a point where. They’ll work out a deal. she and the president will work out a deal and it, probably doesn’t take all that long because the DCRA draconian sort of numbers we’re throwing at each other, 145 for us to them and them a hundred and a quarter to us or whatever, and that’s not gonna be there forever.

[00:04:29] Lee Jackson: I mean, they’ll come to some arrangement, but, I think that the TikTok thing will get resolved and I, if I had to bet, if I was, betting on who would win, I think I would lean towards Amazon.

[00:04:43] Doug McIntyre: Yeah. And if I wanna make a, speculative, buy of some Amazon stock. This is the primary reason I would do it.

[00:04:53] Lee Jackson: Yeah. Yeah. I agree. The AWS domination of that cloud world is not what it was no. Five years ago. Microsoft (NASDAQ: MSFT | MSFT Price Prediction) and Azure made huge inroads. There’s other people making inroads, but offering them a new line of business. For Amazon and just for our viewers our regular readers.

[00:05:15] Lee Jackson: While he doesn’t have a big position, Warren Buffet owns Amazon. He does. Good. Good man.

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.