US software giant Microsoft says it is "moving quickly" on a deal with TikTok's Chinese parent company ByteDance to sell-off its US operations in order to keep the video-sharing platform alive in its critical American market.
Microsoft CEO Satya Nadella met with US President Donald Trump on Sunday to discuss the deal and the President's concerns over US users' security and privacy. In a corporate blog post afterwards, Microsoft says "it fully appreciates the importance of addressing the President’s concerns. It is committed to acquiring TikTok subject to a complete security review and providing proper economic benefits to the United States."
The blog post says Microsoft, which is also the parent company of LinkedIn, is aiming to complete its discussions with ByteDance no later than September 15, 2020.
In a newly proposed deal over the weekend, ByteDance has reportedly agreed to leave the US business completely in a deal that would see LinkedIn-parent company Microsoft take over TikTok in the United States, according to Reuters sources in a report on Saturday. These sources said Microsoft would be charged with protecting TikTok’s US user data and could also involve other US investors or companies in the takeover. Another source cited in a report by the South China Morning Post suggests ByteDance would prefer an independent spin-off to a direct sale to Microsoft.
The White House had earlier rejected a proposal under which ByteDance would retain a minority stake in TikTok's US business. It has cited concerns over the potential for US user data to be sent to China to be used by the Chinese governement. Over the weekend, a senior trade official told Fox News that Trump was likely to take action on TikTok by Monday, comments that were echoed by US secretary of state Mike Pompeo on Fox News on Sunday.
Meanwhile, the Australian Broadcasting Corporation is reporting that the federal government in Canberra is scrutinising TikTok as well over similar security concerns.
The ABC says Prime Minister Scott Morrison has asked Australia's intelligence agencies to investigate potential security threats from Tik Tok while the Department of Home Affairs considers how to mitigate any privacy or data security risks uncovered.
TikTok & China's response to US criticism
TikTok has long argued it does not share international user data with Beijing and maintains it respects user privacy. On Saturday, TikTok's US general manager Vanessa Pappas posted a video message by notification to all US users, saying: "We're not planning on going anywhere". But in the message (shown below), Pappas' response takes a softer approach, thanking users for their support, noting the jobs and content initiatives the platform has funded in the US.
A message to the TikTok community.♬ original sound - tiktok
Meanwhile, Chinese reaction to the weekend's events has been sharp. The editor-in-chief of Chinese state media publisher Global Times slammed the " hunting and looting of TikTok by the US government" as ploy to force ByteDance into selling low out of desperation. It argued the US is less concerned about national security whereas "the real issue that truly concerns Washington is the ability of Huawei and TikTok to challenge the high-tech hegemony of the US."
TikTok has been been in the crosshairs of a political battle for weeks, riding out considerable upheaval across Asian markets following its ban in India, a potential ban in Pakistan, and switching its platforms in Hong Kong following the introduction of a new national security law from Beijing.