Following a conversation between President Donald Trump and CEO Satya Nadella, Microsoft has confirmed that it is hoping to complete discussions about acquiring TikTok by 15 September.
TikTok, which is owned by Beijing-based ByteDance, is a social media platform for viewing and sharing short-form videos set to music. Despite its explosion in popularity among young users, the app has faced heated criticism for its data collection practices, censorship of user-generated content, and alleged transmission of user data to Chinese servers.
The app has been banned in India (its largest market) and is now facing a potential ban in the US.
Microsoft has been engaged in discussions with ByteDance about the purchase of TikTok, although recent comments from President Trump about imminent plans for a TikTok ban via executive order – on the basis of “very serious national security concerns” – have cast doubt on the effort. Now, Microsoft has confirmed that it is engaging with the White House to address concerns.
It will keep the White House informed about progress, and attempt to conclude discussions with ByteDance by September 15. No further official updates are expected until the discussions are complete and a decision has been made by Microsoft and ByteDance.
“Following a conversation between Microsoft CEO Satya Nadella and President Donald J Trump, Microsoft is prepared to continue discussions to explore a purchase of TikTok in the [US]. Microsoft fully appreciates the importance of addressing the President’s concerns. It is committed to acquiring TikTok subject to a complete security review and providing proper economic benefits to the US, including the US Treasury,” a Microsoft statement said.
Addressing data privacy concerns, Microsoft said that the new operating model would include new “world-class security, privacy, and digital safety protections”. For instance, all US user data would be stored in US-based data centres, while any US user data currently retained on foreign servers would be deleted after transfer. TikTok has said that US user data is stored in the US with strict controls on employee access.
The purchase would cover TikTok in the US, Canada, Australia, and New Zealand with Microsoft taking responsibility for operating in these markets. Microsoft said that it may invite other US investors to participate with the acquisition on a minority basis.
An acquisition of TikTok by Microsoft would give the US tech giant – which already owns LinkedIn – a far stronger foothold in the social media sphere, which is dominated by rivals like Facebook and Google. TikTok has around 100 million US-based users.
Trump’s attack on TikTok comes amid escalating US-China tensions, with Chinese tech companies like Huawei, TikTok, and ZTE in the direct firing line. This weekend, US Secretary of State Mike Pompeo told Fox News that Trump would take undefined action against what he perceives as a range of national security risks posed by software with connections to Beijing.
Meanwhile, TikTok is reported to continuing with plans to open a headquarters in London as the company continues to position itself as distant from Beijing, for example with the appointment of former Disney executive Kevin Mayer as its CEO.