Microsoft looks to buy TikTok

The computing giant has its eye on the video app as it comes under pressure over claims of political censorship and foreign investment review in the US

Short-form video app, Tik Tok, is in line to be acquired by Microsoft in the US, with the computing giant saying  discussions are continuing.

In a company blog, Microsoft said it’s committed to acquiring TikTok “subject to a complete security review and providing proper economic benefits to the United States, including the United States Treasury”.

The Chinese-backed platform, which recently opened a local office in Australia, specialises in short dance, lip sync and performance videos. The latest social media platform has seen an uptick in use this year, with significant spikes during the COVID-19-enforced lockdown. TikTok also recently launched its marketing offering, encouraging brands not to make ads, but instead TikToks.

Brands including Mini, McDonald's, Samsung, Fanta, Milo and Menulog, which ran a #DeliveryDance hashtag campaign with a Snoop Dogg track, have added the video platform to the marketing playbook. Locally, Australian brands like Optus and Suncorp have also taken to TikTok.

Originally launched in China in 2016 as Douyin, TikTok debuted outside of China in 2017 and became the most downloaded app in the US in October 2018. It is now available in more than 150 markets and 75 languages.

However, the video app has come to the attention of the US president who has threatened to ban the app over what Peter Navarro, director of the White House office of trade and manufacturing policy, called “serious national security concerns” on Fox News in the US.

Microsoft said it will continue discussions with TikTok parent company, ByteDance, that build upon a notification made by both companies to the Committee on Foreign Investment in the United States (CFIUS). The two companies have provided notice of their intent to explore a preliminary proposal 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.

The foreign investment committee in the US has reportedly been looking into ByteDance's acquisition of Musical.ly, which was rebadged as TikTok. There have also been stories Tik Tok has been suppressing some political content such as Black Lives Matter videos, prompting several US government officials to call for a review of the business. 

Among other measures, Microsoft said it would ensure all private data of TikTok’s American users is transferred to and remains in the US. The deal would include owning and operating TikTok in the US, Canada, Australia and New Zealand markets.

“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," Microsoft stated in a blog post.

Microsoft said it won’t provide any further updates until there is a definitive outcome to discussions set to be signed off no later than 15 September 2020.

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