On Friday night, President Trump told reporters that he was banning the mega-popular video-sharing app TikTok in the U.S
It became clear that TikTok as we know it is coming to an end in the U.S. There’s a general consensus among American leadership that “TikTok cannot stay in the current format” because of risks over Americans’ personal data.
TikTok is owned by Chinese tech company ByteDance, which could be forced by law to hand over user information to the Chinese government.
So what happens next?
There seem to be two options: 1) ban or 2) sell to an American company.
This weekend, President Trump said he was choosing door number one—banning Tiktok from operating in the U.S. But…he didn’t, which adds further speculation to the idea that his “ban” announcement was a negotiating tactic to extract further concessions from ByteDance in the event of a sale.
So what about a sale? Microsoft.. Hell No.. , Well they did confirmed last night it’s been talking to ByteDance about acquiring TikTok’s service in the U.S., Canada, Australia, and New Zealand. The company said it’ll “move quickly” to reach a deal, and will finish up negotiations by Sept. 15 latest.
What an acquisition would mean for Microsoft
It’s worth noting Microsoft was the only member of “Big Tech” that was absent from last week’s antitrust hearing. The company has focused on business customers rather than individual customers, and, with a market value of nearly $1.6 trillion, that’s been a pretty successful strategy.
A TikTok acquisition would change that. Yes, Microsoft does have consumer-focused units, most notably Xbox, which reported 65% sales growth last quarter. But its recent acquisitions—LinkedIn, GitHub, and a crowd of smaller startups to support its cloud business—were a play for the enterprise segment.
A deal for TikTok would put Microsoft in unfamiliar—but also exciting—territory. TikTok has just begun to monetize its exploding user base.
Bottom line: With several Republican senators, including China hawks, comfortable with a sale to an American company, the smart money is on Microsoft pulling this one off. But it all depends on Mr. President.