TikTok’s Chinese owner offers to forego stake to clinch United States deal

A man opens social media app 'Tik Tok' on his cell phone. Source AP

Late yesterday (Friday July 31st), US President Donald Trump told reporters on Air Force One that he was planning to ban TikTok in the US, apparently not satisfied with news reports that Microsoft was in talks to buy the video service from ByteDance.

"What's the right answer?"

Media reports circulated earlier Friday saying that Trump would require the United States operations of the app be divested from its Chinese parent firm ByteDance, but the president announced a ban.

It is believed that the deal is also allowing for some ByteDance investors the opportunity to retain minority shareholders of the new business.

In an official statement, the White House said: "The administration has very serious national security concerns over TikTok".

Under the new deal, the company would exit completely and turn over 100 per cent control of the app's United States wing to Microsoft.

Although Trump's stance forced Microsoft and ByteDance to pause the TikTok acquisition deal, reports indicate that talks are not completely dead, while the president "has a deal on his desk", according to Axios sources.

Off the back of TikTok's incredible popularity came a new wave of celebrities, who have amassed millions of followers from the videos they have created.


Earlier, media reports had suggested Trump would require that the USA operations of the app be divested from ByteDance, but he instead announced a ban.

ByteDance in Beijing did not respond to a request for comment.

Trump has said a ban would be a way to punish China over its role in the coronavirus pandemic, while Secretary of State Mike Pompeo cited national-security concerns.

Under ByteDance's new proposal, Microsoft, which also owns professional social media network LinkedIn, will be in charge of protecting all of TikTok's U.S. user data, the sources said.

The message from Pappas was pushed out to all U.S. -based users on TikTok as a notification, and appears on their discover page, making it clear they want this seen by the entire community.

The proposed divestment would not necessarily affect TikTok's operations outside the United States, the Times report said. The app, which has more than 2.3 billion downloads worldwide, was most recently valued at a whopping $30 billion to $50 billion. Ordering the divestment of TikTok would not be the first time the White House has taken action over such concerns.

On Saturday, in a bid to reassure TikTok's millions of US users, Vanessa Pappas, the country's general manager said in a video message: "We're not going anywhere". The Chinese company behind the social media phenomenon is called ByteDance.

The app features not only entertainment videos, but also debates, and it takes positions on political issues, such as racial justice and the coming USA presidential election.

Related:

Comments

Latest news

Federal Reserve says economic recovery depends on Covid-19
In his news conference, Powell elaborated on just how much remained unclear about the direction of the world's largest economy. The Fed said that over the coming months the Federal Reserve will increase its bond holdings "at least at the current pace".

New Battletoads Game Arrives for Xbox One, Windows PCs on August 20
It'll also feature 3 player drop in and out couch co-op, with varying gameplay sequences that will appeal to all kinds of players. For those unaware, the original Battletoads game is (in) famous for its difficulty.

German economy sees deepest decline on record
The pandemic also destroyed more than a million jobs in Spain in the second quarter, mostly in the services and tourism sector. France's economy started shrinking in the last quarter of 2019, before the coronavirus pandemic hit Europe with full force.

Hundreds of kids infected with coronavirus within days at overnight camp — CDC
Per the CDC , 597 individuals - including campers and both teen and adult staffers - attended the camp in June. The following day, she was tested for coronavirus and reported a positive result, according to the report.

India registers lowest COVID-19 mortality rate at global level
According to the data of the Ministry of Health, there are now 5 lakh 67 thousand 730 active cases of corona in the country. At the same time, 14 people died in Bihar and Telangana , 12 in Jammu and Kashmir, and 11 in Rajasthan.

Other news