Microsoft Will Continue To Explore Potential TikTok Deal

The Redmond, Wash. tech giant said it will move quickly to pursue discussions with TikTok’s parent company, ByteDance, in a matter of weeks with the goal of completing talks by mid-September.

Microsoft on Sunday said that it was in preliminary talks to buy the video-sharing social network TikTok in the U.S. and a variety of other countries days after the Trump administration threatened to ban the popular service.

Microsoft said it will move quickly to pursue discussions with TikTok’s parent company, China-based ByteDance, “in a matter of weeks” with the goal of completing talks by Sept. 15. During this process, Microsoft looks forward to continuing dialogue with the United States Government, including with the President.

In a blog post, the Redmond, Wash.-based tech giant said that its CEO, Satya Nadella, and President Donald Trump had discussed the deal after the Trump administration expressed concerns about its Chinese ownership.

Microsoft said the two companies talked of a potential deal that would involve a purchase of the TikTok service in the United States, Canada, Australia, and New Zealand and would result in Microsoft owning and operating TikTok in these markets. Microsoft said it may invite other American investors to participate on a minority basis in this purchase.

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

“Among other measures, Microsoft would ensure that all private data of TikTok’s American users is transferred to and remains in the United States,” the company added. “To the extent that any such data is currently stored or backed-up outside the United States, Microsoft would ensure that this data is deleted from servers outside the country after it is transferred.”

News of a potential TikTok-Microsoft deal emerged on Friday after Fox Business reporter Charles Gasparino reported on Twitter that he had confirmed with investment banking sources that Microsoft is “in talks to buy” TikTok’s U.S. business.

Trump had also threatened to ban TikTok, NBC News reported.

“Well, I have that authority. I can do it with an executive order or that,” Trump told NBC News.

“TikTok is loved by 100 million Americans because it is a home for entertainment, self-expression, and connection,” a TikTok spokesperson told CRN via email. “We‘re motivated by their passion and creativity, and committed to continuing to bring joy to families and meaningful careers to those who create on our platform as we build TikTok for the long term. TikTok will be here for many years to come.”

TikTok features short videos posted by users and has emerged as a hugely popular social app in the U.S. in recent years, particularly among younger users.

TikTok parent ByteDance has been under investigation by the Committee on Foreign Investment in the U.S. since last fall, amid worries that TikTok could be used by the Chinese government to acquire data on Americans, Bloomberg reported. However, the committee is also concerned about a potential Microsoft purchase of the TikTok U.S. operations, Gasparino tweeted.

While Microsoft in the past has had strong consumer tech aspirations--and is a force in gaming with its Xbox brand--the company has shifted to focus on serving business customers in recent years under CEO Satya Nadella. In June, for instance, Microsoft announced it would permanently close its chain of retail stores.

The company does have a massive social media holding in LinkedIn, acquired for $26.2 billion in 2016, though the focus there is on professional networking.