Microsoft has confirmed that it is exploring the possibility to acquire TikTok in the United States. In a blog post on Sunday, the company said CEO Satya Nadella has had a conversation with the US President Donald J. Trump on the matter.
The Indian government recently banned TikTok on security grounds. The app was facing a similar fate in the US because of its Chinese roots and associated privacy and security concerns. However, newer reports suggest that the Trump administration is pushing for an American takeover of the popular short video-sharing app in the US instead of an outright ban.
Microsoft emerged as a potential buyer last week and the company has now officially confirmed the developments. The company is "committed to acquiring TikTok subject to a complete security review and providing proper economic benefits to the United States," an official statement read.
Microsoft may acquire TikTok US
Microsoft has announced that it will soon begin discussions with TikTok’s parent company, ByteDance, over a potential purchase of the app's US arm. The discussions will begin in a matter of weeks. The software giant hopes to reach a definitive outcome by September 15, 2020.
Microsoft and ByteDance have already provided notice to the Committee on Foreign Investment in the United States (CFIUS). The two companies have expressed their intent to explore a preliminary proposal. The potential deal would involve Microsoft acquiring TikTok in the United States, as well as Canada, Australia, and New Zealand.
The company, however, isn't committing to undertake the purchase completely on its own. It may also invite other American investors to participate in this purchase on a minority basis.
If Microsoft does reach a deal with ByteDance, which is very likely to happen, it promises to transfer and keep all private data of TikTok’s American users within the country. It will also ensure that data currently stored or backed-up outside the United States is deleted after it is transferred.
Microsoft's operating model for TikTok will further ensure transparency to users, the company says. It will build on the experience of TikTok users while adding world-class security, privacy, and digital safety protections. Additionally, it will ensure appropriate security oversight by governments in the countries where the company will have ownership.
It's unclear how Microsoft would cut off those countries from other markets where TikTok currently operates. The company hasn't disclosed any deal terms yet. The discussions are still in preliminary stages. In the meantime, it will also continue to hold talks with the Trump administration to discuss security concerns.