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Microsoft may be in talks to buy TikTok; Trump mulls banning Chinese app

Amid reports that the US was planning to order China’s ByteDance to sell popular video app TikTok and tech giant Microsoft was in talks to purchase it, President Donald Trump on Friday said that his administration was weighing action against the popular app, which had been “a source of national-security and censorship concerns”.

“We are looking at TikTok,” Trump told reporters at the White House. “We may be banning TikTok. We may be doing some other things. There are a couple of options, but a lot of things are happening. So we’ll see what happens.”

There have been reports of US tech giants and financial firms being interested in buying or investing in TikTok as the Trump administration sets its sights on the app. The New York Times and Fox Business, citing an unidentified source, reported on Friday that Microsoft was in discussions to buy TikTok, though Microsoft declined to comment.

TikTok issued a statement on Friday saying: “While we do not comment on rumours or speculation, we are confident in the long-term success of TikTok.”

ByteDance launched TikTok in 2017, then bought Musical.ly, a video service popular with teens in the US and Europe, and combined the two. A twin service, Douyin, is available for Chinese users.

TikTok’s fun, goofy videos and ease of use have made it immensely popular, and US tech giants like Facebook and Snapchat see it as a potential threat. It has said it has tens of millions of US users and hundreds of millions globally.

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TikTok issued a statement Friday saying that, “While we do not comment on rumours or speculation, we are confident in the long-term success of TikTok.”

But its Chinese ownership has raised concerns about the censorship of videos, including those critical of the Chinese government, and the potential for sharing user data with Chinese officials.

TikTok maintains it doesn’t censor videos based on topics sensitive to China and it would not give the Chinese government access to US user data even if asked. The company has hired a US CEO, a former top Disney executive, in an attempt to distance itself from its Chinese ownership.

US national-security officials have been reviewing the Musical.ly acquisition in recent months, while US armed forces have banned their employees from installing TikTok on government-issued phones. Secretary of State Mike Pompeo said earlier this month that the US was considering banning TikTok.

These national-security worries parallel a broader US security crackdown on Chinese companies, including telecom providers Huawei and ZTE. The Trump administration has ordered that the US stop funding equipment from those providers in US networks.

It has also tried to steer allies away from Huawei because of worries about the Chinese government’s access to data, which the companies have denied it has.

The Trump administration has stepped in before to block or dissolve deals on national-security concerns, including stopping Singapore’s Broadcom from its USD 117 billion bid for US chipmaker Qualcomm in 2018 in an effort to help retain US leadership in the telecom space.

It also told China’s Beijing Kunlun Tech Co. to sell off its 2016 purchase of gay dating app Grindr.

Other countries are also taking action against TikTok. India this month banned dozens of Chinese apps, including TikTok, citing privacy concerns, amid tensions between the countries.

SourceBusiness Standard