Technology giant Microsoft is reportedly planning to acquire US business of Chinese-owned app Tik Tok. These reports surfaced amid the US considering banning the app due to national security concerns. Note that a few Senators want the app banned, or at least investigated for censorship. Secretary of State, Mike Pompeo, said in July that the U.S. should probably ban TikTok.
Wall Street Journal reported on Saturday that Satya Nadella-led Microsoft is in advanced talks to acquire the U.S. operations of TikTok. Sources privy to the discussion told the publication that a deal could be completed by Monday. The talks reportedly involve representatives from Microsoft, Bytedance and the White House.
It is worth mentioning that Trump told reporters Friday at the White House that they are looking at TikTok. "We may be banning TikTok. We are looking at a lot of alternatives with respect to TikTok," he said. Spokespeople for Microsoft and TikTok have not commented on any potential talks so far.
If the deal materialises, it would be a concession to White House pressure and make Microsoft a major player in social media. However, any transaction could face regulatory hurdles. Note that ByteDance bought Musical.ly Inc. in 2017 and merged it with TikTok, becoming a hit in the U.S -- the first Chinese app to do so. As TikTok's popularity increase, U.S. officials grew concerned about the potential for the Chinese government to use the app to gain data on U.S. citizens.
TikTok, which has over 2.3 billion downloads worldwide, was recently valued between $30 billion and $50 billion. While there is clarification as to where TikTok would fit into Microsoft's business since the tech giant's major presence in the social networking as of now is LinkedIn, if this deal is successful, Microsoft may take a big leap in the sector.
Several media reports citing anonymous sources said the Trump administration could soon announce a decision ordering TikTok parent ByteDance to divest its ownership in the app. There have been multiple reports of US tech giants and financial firms being interested in buying or investing in TikTok. Microsoft’s interest in the app was reported earlier by Fox Business News where it stated that if Microsoft were to buy TikTok, there would be no ban on the app in the US.