In a surprising turn of events, the near-acquisition of the social media giant, TikTok, by Microsoft last year emerged as one of the most unusual endeavors undertaken by the tech industry. Microsoft's Chief Executive Officer, Satya Nadella, recently shared his insights on this peculiar journey during an interview at the Code Conference in Beverly Hills, California.
The Unconventional Deal
TikTok found itself at the center of a maelstrom when then-U.S. President Donald Trump demanded the separation of its U.S. operations from its Chinese parent company, ByteDance. This move was driven by national security concerns related to the collection of U.S. users' data. Microsoft, a tech behemoth, initiated discussions about acquiring TikTok in August 2020. However, this potential acquisition faced an unexpected downfall and was abandoned by September of the same year.
Nadella's Perspective
During the Code Conference interview, Satya Nadella shared his unique perspective on the failed acquisition. He highlighted the extraordinary nature of the situation, expressing his eagerness to bring Microsoft's expertise in security, child safety, and cloud technology to TikTok.
Nadella's remarks shed light on the complex dynamics at play during this time. TikTok approached Microsoft for a possible deal, rather than the other way around, which was an unusual twist in the tech industry.
The Political Landscape
Nadella also delved into the intricate political landscape that contributed to the downfall of the deal. President Trump had distinct objectives in mind regarding TikTok, and these goals ultimately led to the abandonment of the acquisition. The U.S. government had its own set of requirements, which seemed to evaporate as quickly as they had appeared.
What Attracted ByteDance to Microsoft?
The question that arises is, what exactly made ByteDance's CEO, Zhang Yiming, consider Microsoft as a potential partner? The answer lies in Microsoft's existing services related to content moderation and child safety. These services were developed through products integrated into Xbox video gaming tools and the business-oriented social network, LinkedIn.
The Uncertain Future
As for the current status of TikTok's situation, Satya Nadella remained uncertain about whether the U.S. is still pursuing a deal under President Joe Biden's administration. The Biden administration has asserted that it is reviewing national security concerns, leaving the future of TikTok in the United States hanging in the balance.
Supporting Cryptocurrency Regulation
In an unexpected twist, Nadella also voiced his support for increased government regulation of cryptocurrency. This stance is crucial, given that such regulations can play a vital role in curbing ransomware attacks, as these illicit ransoms often flow through opaque cryptocurrency systems.
Conclusion
In summary, Microsoft's near-acquisition of TikTok in 2020, as recounted by CEO Satya Nadella, stands out as an extraordinary chapter in the tech industry's history. The complex political landscape, unexpected turns of events, and the uncertain future of TikTok in the United States have made this story one of intrigue and mystery. Satya Nadella's perspective provides insight into the inner workings of the tech world, and it remains to be seen how the future will unfold for TikTok in the U.S. amidst changing administrations and evolving security concerns.
Microsoft CEO says failed TikTok deal 'strangest thing I've worked on' Sept 27 (Reuters) - Microsoft Corp's (MSFT. O) , opens new tab near-acquisition of social media app TikTok last year was the "strangest thing I've ever worked on," Chief Executive Officer Satya Nadella said on Monday.
Larger challenges make a Microsoft-TikTok deal unlikely.
Microsoft declined to settle for a lesser deal that didn't put those assets under its control. Ultimately, TikTok struck a lesser partnership with Oracle and Walmart that was later shelved by the Biden administration.
Kevin O'Leary is putting together a syndicate for a potential purchase of TikTok, with a starting bid of $20 billion to $30 billion — an up to 90% cut in valuation from the company's last funding round.
Not only because it's still unprofitable, but also because of the migraine headaches inherent in owning and operating a popular social media company. Look ahead: The most logical buyers for TikTok are ByteDance's non-Chinese investors, including General Atlantic, Sequoia Capital, and Susquehanna International Group.
At $100 billion, there are few companies that could afford to buy TikTok outright. And those that could in theory — Meta, Alphabet, Microsoft — would almost certainly run into regulatory roadblocks.
Microsoft in August 2020 began talks on the proposed acquisition but the deal collapsed by September. Trump's divestment push ended by the time he left office in January and no potential suitor ending up acquiring TikTok.
In August 2020, Microsoft had a strange, short-lived opportunity to buy TikTok, after parent company ByteDance was coerced into selling its U.S. operations by the Trump administration. Microsoft's deal to buy TikTok quite quickly fell through. Oracle was chosen instead, however that never happened either.
But the TikTok ban reflects widespread concerns from lawmakers about China. Members of both parties, along with intelligence officials, have worried that Chinese authorities could force ByteDance to hand over American user data or direct the company to suppress or boost TikTok content favorable to its interests.
“Shark Tank” investor and businessman Kevin O'Leary said in an interview with Fox News that TikTok is “not going to get banned 'cause I'm going to buy it.” O'Leary posted the interview to his own TikTok account. He also said Meta and Google won't buy the app, citing regulatory concerns.
TikTok is banned in China along with other social media platforms. Instead, Chinese users use a similar app, Douyin, which is only available in China and subject to monitoring and censorship by the government.
Zhang Yiming (Chinese: 张一鸣; born April 1, 1983) is a Chinese internet entrepreneur. He founded ByteDance in 2012, developed the news aggregator Toutiao and the video sharing platform Douyin (internationally known as TikTok).
ByteDance doesn't want to sell TikTok and will do everything in its power to avoid such a scenario, including fighting it in US courts. The Chinese government would also need to approve any divestiture plan and has said publicly that it would oppose a forced sale.
You often see products for as low as $0.50. How is that possible? One theory is that TikTok is subsidizing purchases in an effort to get people used to buying stuff on Shop. Another, put forward by Bloomberg, is that a lot of what's available on Shop is cheap products from China with lots of counterfeits for sale.
My name is Shou Chew and I am the CEO of TikTok, an online community of more than a billion people worldwide -- including well over 170 million Americans -- who use our app every month to create, to share, and to discover.
Political bias (elections are going to be a big issue). TikTok similarly has a lot of controversy. 1/ Facebook likely would face antitrust concerns if it acquired a large social network. If the deal is blocked, Facebook would be on the hook for a large break up fee (common in M&A term sheets).
TikTok is shutting its creator fund on Dec. 16. The fund, announced in 2020 and currently valued at $2 billion, was a way for short-form content creators to get paid for their content. On Monday, Fortune reported that the company has decided to forgo the program altogether.
Google parent company Alphabet and Meta are some of the only companies capable of single-handedly paying TikTok's price tag at its current $100 billion valuation. Google CEO Sundar Pichar previously ruled out buying TikTok in 2020 when former President Donald Trump was trying to ban the app.
The House passed a bill Saturday that could force the sale of the ultra-popular video app TikTok within a year or face having it banned from U.S. app stores.
Introduction: My name is Dean Jakubowski Ret, I am a enthusiastic, friendly, homely, handsome, zealous, brainy, elegant person who loves writing and wants to share my knowledge and understanding with you.
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