ByteDance caves to Trump, agrees to sell 100% of TikTok to Microsoft. President Trump’s insistence that the White House will ban the social-media app TikTok from the US triggered a wave of hysteria among users of the app: whatever will the American teens who built enormously valuable brands sharing dance videos on the app do now? They were just hanging out wit the Kardashians! What are they supposed to do now?
China’s still-largely-state-controlled corporate sector has enough exposure to the vicissitudes of survival in the ultra-competitive, heavily scrutinized, anti-trust addled world of big tech that the leaders of Bytedance know that this kind of pressure is simply untenable. For TikTok to survive, ByteDance would need to play the administration’s game.
Earlier this week, reports about a group of VCs bidding as much as $50 billion for the non-China business had emerged. Then Friday afternoon, Fox Business – and then the New York Times, and a gaggle of other media orgs – confirmed that Microsoft was in talks to buy the social media platform.
But as it turns out, it looks like Trump’s threats have had the desired effect, and ByteDance is now reportedly ready to let go of TikTok, passing 100% control to Microsoft in a deal that would see the app brought completely under the control of the American tech giant.
Here’s more from Reuters:
China’s ByteDance has agreed to divest the U.S. operations of TikTok completely in a bid to save a deal with the White House, after President Donald Trump said on Friday he had decided to ban the popular short-video app, two people familiar with the matter said on Saturday.
ByteDance was previously seeking to keep a minority stake in the U.S. business of TikTok, which the White House had rejected. Under the new proposed deal, ByteDance would exit completely and Microsoft Corp would take over TikTok in the United States, the sources said.
Some ByteDance investors that are based in the United States may be given the opportunity to take minority stakes in the business, the sources added.
The White House did not respond to a request for comment on whether Trump would accept ByteDance’s concession. ByteDance in Beijing did not respond to a request for comment.
Under ByteDance’s new proposal, Microsoft will be in charge of protecting all U.S. user data, the sources said.
The plan allows for another U.S. company other than Microsoft to take over TikTok in the United States, the sources added.
Microsoft did not respond to a request for comment.
In the end, it looks like Trump was simply using the bully pulpit to ensure America’s superiority.
Earlier today, it appeared that President Trump’s late-night threat about banning TikTok had motivated ByteDance and Microsoft to speed up their talks.
But as the New York afternoon wore on, a Dow Jones headline proclaimed that Microsoft and ByteDance had decided to abruptly stop negotiations.
Microsoft Corp. and Bytedance Ltd. have put acquisition talks for TikTok on hold after President Donald Trump said Friday he would oppose the deal, Dow Jones reported, citing people familiar with the matter who weren’t identified.
Trump’s comments prompted TikTok to make additional concessions, including agreeing to add as many as 10,000 jobs in the U.S. over the next three years, according to the report.
Microsoft was exploring an acquisition of TikTok’s operations in the U.S., people familiar with the matter said Friday. A deal would give the software company a popular social-media service and relieve U.S. government pressure on the Chinese owner of the video-sharing app.