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Microsoft Bid To Acquire TikTok Hits The Trump Wall, Negotiations On Hold

Swarajya Staff

Aug 02, 2020, 10:56 AM | Updated 10:56 AM IST

TikTok Logo (Official Tiktok Website)
TikTok Logo (Official Tiktok Website)

Microsoft has temporarily halted its negotiation to buy the U.S. operations of the video-sharing app TikTok after U.S President Donald Trump’s statement last night (Aug 1) categorically asserting that he intents on ban the Chinese app and will not allow such any acquisition deal, The Wall Street Journal reported.

Trump on Friday told reporters on board the Air Force One that he will exercise his executive power to ban Chinese-owned video app TikTok from the United States

Bytedance, the Chinese owner of TikTok, is still attempting to salvage the proposed deal by pledging to add as many as 10,000 jobs in the U.S. over the next three years. The company currently has about 1,500 employees in the U.S. It claims that 100 million Americans use TikTok for entertainment and connection and it has deployed a $1 billion creator fund supports US creators who are building livelihoods from our platform

In an attempt to further solidify its play in the consumer technology space, Microsoft has been in advanced talks to buy the TikTok from ByteDance. Microsoft had earlier acquired LinkedIn for $27 billion in 2016. In 2014, the company paid $2.5 billion to purchase game developer Mojang, whose Minecraft title is huge popular among younger users who also make up TikTok’s core audience in the U.S.

According to the reports, the proposed deal would have seen Microsoft in charge of protecting U.S.-based users’ data, and another U.S.-based company operating TikTok.

Bytedance executives still believe that Trump’s ban threat is a ploy to compel the Chinese technology company to sell the U.S business in full and lower the price it was offering Microsoft.

Late last year, the U.S has launched an national security review of TikTok following apprehensions expressed by several US senators.

The U.S Treasury also launched a probe in to ByteDance's acquisition of Musical.ly in 2017. The $1bn purchase enabled the explosive growth of TikTok in U.S.

U.S Senator led by Marco Rubio had called for a national-security review of the 2017 deal. Rubio claimed that TikTok is censoring content at the behest of China. He accused the widely popular app of blocking sympathetic coverage of protests in Hong Kong and reports about China’s treatment of Muslim minorities.

Cfius (Committee on Foreign Investment in the United States), the division of the US Treasury which checks foreign purchases of US companies on security grounds., was tasked with probing.

TikTok continues to reject claims of censorship saying that its content moderation policies aren’t influenced by any government and that the Chinese government hasn’t requested that TikTok censor content.


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