U.S. President Donald Trump has just revealed Microsoft potential acquisition of TikTok, sparking speculation of a bidding war for the popular social media app.
Microsoft declined to comment. TikTok and ByteDance did not immediately respond to Reuters’ requests for a comment outside regular business hours.
What Does Microsoft’s Potential Acquisition of TikTok Mean for the Social Media Landscape?
TikTok, which has almost 170 million American users, was briefly banned in the U.S just before a law requiring its Chinese owner ByteDance to either sell it on national security grounds or face a ban took effect on January 19.
President Trump, after taking office on January 20, signed an executive order seeking to delay by 75 days the enforcement of the law requiring TikTok to stop operating in the U.S.
Just after his inauguration, Trump announced that he was in talks with multiple people over buying TikTok and would likely have a decision on the popular app’s future in 30 days.
The newly sworn in U.S. president has previously, said that he was open to billionaire Elon Musk buying the social media app if the Tesla CEO wanted to do so but at the time of filing this report, Musk, has yet to publicly comment on Trump’s offer.
More recently, AI startup Perplexity AI on Sunday made a proposal to consolidate with TikTok, with the U.S. government getting up to half of the new company in future after the deal, a source revealed to Reuters on Sunday.
This alleged talks makes it the second time that Microsoft has been in the discussion to acquire TikTok. During his first term, Donald Trump ordered TikTok to separate its U.S. version from ByteDance citing national security concerns.
Microsoft eventually emerged as a top bidder in 2020, but the talks soon fell through, and Trump’s divestment push ended a few months later when he left office.
Microsoft CEO Satya Nadella had said back then in 2021 that the deal was the “strangest thing I’ve ever worked on.”
“The U.S. government had a particular set of requirements and then it just disappeared,” Nadella remarked.
Understanding the Implications of a Microsoft-TikTok Deal on US-China Relations
If the Microsoft-TikTok acquisition happens quickly, it would come at a time of rising geopolitical tensions between the US and China, with the US government having previously expressed concerns about TikTok’s data collection practices and potential ties to the Chinese government.
The deal could also lead to diplomatic fallout, as China may view the acquisition as a US attempt to exert control over a Chinese tech company leading to likely retaliatory measures from China and further strain US-China relations.
