Microsoft continues talks to buy TikTok after CEO meets with Trump

Microsoft said in a blogpost on Sunday that, following a meeting with United States President Donald Trump, Chief Executive Officer Satya Nadella remains in discussions to acquire TikTok in the US.

Microsoft was already in talks to purchase TikTok after Trump and US Secretary of State Mike Pompeo criticized TikTok’s ownership by Chinese startup ByteDance.

However, a source close to the matter said talks had stalled after Trump, citing national security concerns, claimed on Friday he would ban TikTok in the US.

Officials in the country have expressed concern that American user data could be given to the Chinese government by ByteDance.

However, TikTok officials have repeatedly emphasized that such concerns may be exaggerated as the data of Americans is not subject to Chinese law. US data is stored in US-based servers backed up in Singapore.

Nonetheless, Microsoft said that to ease the concerns of US officials, it would complete a security review of the app before any potential purchase.

“[Microsoft] is committed to acquiring TikTok subject to a complete security review and providing proper economic benefits to the United States, including the United States Treasury.

“Microsoft will move quickly to pursue discussions with TikTok’s parent company, ByteDance, in a matter of weeks, and in any event completing these discussions no later than September 15, 2020.

“During this process, Microsoft looks forward to continuing dialogue with the United States Government, including with the President,” the company went on to add in the blogpost.

If Microsoft acquires TikTok, it would own and control TikTok services in the US, New Zealand, Canada and Australia. American user data would also be transferred to and maintained in the US as part of its ongoing deal with ByteDance.

“This new structure would build on the experience TikTok users currently love, while adding world-class security, privacy and digital safety protections, " Microsoft said.

“The operating model for the service would be built to ensure transparency to users as well as appropriate security oversight by governments in these countries.”

On Sunday, ByteDance said in its own statement published on Chinese social media site Toutiao that it “has always been committed to becoming a global company" but “in this process, we are faced with all kinds of complex and unimaginable difficulties” such as a “tense political environment.”

“But we still adhere to the vision of globalization and continue to increase investment in markets around the world, including China, to create value for users around the world.

“We strictly abide by local laws and will actively use the rights granted to us by the law to safeguard the legal rights of the company,” the company added.

Prior to the current deal, ByteDance had offered to reduce its ownership of TikTok and sell a majority stake of the app to American investors, but the Trump administration rejected this proposal.

The Financial Times reported that some executives at ByteDance believe Trump’s intervention and his threat to ban TikTok may be a ploy to secure a better deal for Microsoft.

TikTok declined to comment on the negotiations, with a spokesperson saying on Sunday, “While we do not comment on rumors or speculation, we are confident in the long-term success of TikTok."

Micrsoft are also non-commital at present, saying, “These discussions are preliminary and there can be no assurance that a transaction which involves Microsoft will proceed.”

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