New York: Amid reports that President Donald Trump will order China’s ByteDance to sell its hit video app TikTok’s US operations because of national-security concerns, Microsoft has emerged as a leading buyer.
“We are looking at TikTok,” Trump told reporters Friday at the White House. “We may be banning TikTok.”
Reports by Bloomberg News and the Wall Street Journal citing anonymous sources said the administration could soon announce a decision ordering ByteDance to divest its ownership in TikTok.
There have been reports of US tech giants and financial firms being interested in buying or investing in TikTok. The New York Times and Bloomberg, citing an unidentified source, reported Friday that Microsoft is in talks to buy TikTok. Microsoft did not immediately reply to a request for comment.
The software company’s interest in the app was reported earlier by Fox Business News. If Microsoft were to buy TikTok, there would be no ban on the app in the US.
TikTok issued a statement Friday saying that, “While we do not comment on rumors or speculation, we are confident in the long-term success of TikTok.”
This is not the first time the US would be ordering a Chinese app to sell to a US buyer. In 2016, it told China’s Beijing Kunlun Tech Co. to sell off its 2016 purchase of gay dating app Grindr, over fears that the personal data of several US government officials could allegedly be used by China to blackmail them for sensitive data.
ByteDance launched TikTok in 2017, then bought Musical.ly, a video service popular with teens in the U.S. and Europe, and combined the two. TikTok’s twin service Douyin is available for Chinese users.
TikTok’s fun, goofy videos and ease of use has made it immensely popular, and US tech giants like Facebook and Snapchat see it as a competitive threat. It has said it has tens of millions of US users and hundreds of millions globally.
But its Chinese ownership has raised concerns about the censorship of videos, including those critical of the Chinese government, and the potential for sharing user data with Chinese officials.
TikTok maintains it doesn’t censor videos based on topics sensitive to China and it would not give the Chinese government access to US user data even if asked. The company has hired a US CEO, a former top Disney executive, in an attempt to distance itself from its Chinese ownership.
US national-security officials have been reviewing the Musical.ly acquisition in recent months, while US armed forces have banned their employees from installing TikTok on government-issued phones.
TikTok is also among dozens of Chinese apps banned by India recently citing national security concerns after a border clash between the two countries’ troops last month.
American national-security worries parallel a broader US security crackdown on Chinese companies, including telecom providers Huawei and ZTE. The Trump administration has ordered that the US stop funding equipment from those providers in US networks. It has also tried to steer allies away from Huawei because of worries about the Chinese government’s access to data, which the companies have denied it has.
The Trump administration has stepped in before to block or dissolve deals on national-security concerns, including stopping Singapore’s Broadcom from its $117 billion bid for US chipmaker Qualcomm in 2018 in an effort to help retain US leadership in the telecom space.
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