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Microsoft talks to buy TikTok's US business intensify

August 2, 2020

TikTok is now in the crosshairs of the US government. Parent company ByteDance reportedly offered to sell its US operations, with Microsoft emerging as prime contender.

TikTok closeup logo displayed on a phone screen,
Image: picture-alliance/NurPhoto/N. Economou

US software giant Microsoft is reportedly in advanced talks to buy TikTok's US operations, sources close to the negotiation said on Saturday.

The move comes as the popular Chinese-owned video app has come under intense scrutiny by the US government, including threats from President Donald Trump about banning it from the US altogether.

''As far as TikTok is concerned, we're banning them from the United States,'' Trump told reporters on Friday.

TikTok has been criticized for its Chinese-ownership, accused of censoring videos that are critical of China and for having the capability to share user data with Chinese officials. The company has vehemently denied both claims.

The national security warnings over TikTok national-security worries mirror a broader crackdown on Chinese companies in the US, including telecom providers Huawei and ZTE.

'Not going anywhere'

Microsoft is the fourth-largest digital ad company in the US, lagging behind giants Google, Facebook and Amazon. Buying TikTok could improve the company's performance in the digital advertising market

The New York Times (NYT) reported that ByteDance, TikTok's Chinese parent company, has offered to sell the app's US operations to avoid Trumps ban.

ByteDance is said to have sought to maintain a minority stake in TikTok's American operations, but that the administration rejected that, NYT reported, citing sources close to the negotiations.

Ultimately, the proposed divestment would not necessarily affect TikTok's operations outside the United States, the report said.

On Saturday, TikTok US General Manager Vanessa Pappas reassured users who fear the app will disappear, saying that ''we're not planning on going anywhere'' and highlighting that the app is ''a home for artists and creators'' in the US.

TikTok is the first Chinese internet app to gain a large following outside of China. Likewise, ByteDance has become one of the world's most valuable start-ups and was recently valued at around $100 billion, according to the research firm PitchBook.

jcg/aw (Reuters, AP, AFP)

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