Finally made a voice on its official blog Microsoft acquisition agreement and TikTok America
Microsoft, which has been silent for a long time, finally made a voice on its official blog today (August 3) and confirmed the fact that Microsoft is negotiating with ByteDance to buy TikTok, and revealed an important message that it is not only The acquisition agreement between TikTok America, Microsoft and ByteDance, involving Microsoft’s acquisition of TikTok services in the United States, Canada, Australia, and New Zealand, will enable Microsoft to own and operate TikTok in these markets.
Microsoft said that after the company’s CEO Satya Nadella (Satya Nadella) and U.S. President Trump have a dialogue and communication, Microsoft is ready to continue to explore the acquisition of TikTok in the United States overseas version of TikTok discussions.
At present, Microsoft and ByteDance have notified the Committee on Foreign Investment in the United States (CFIUS) of their intentions to explore a preliminary proposal. The proposal will involve Microsoft’s acquisition of TikTok services in the United States, Canada, Australia, and New Zealand. The market owns and operates TikTok. Microsoft may invite other US investors to participate in this acquisition as minority shareholders.
Microsoft stated that it fully recognizes the importance of addressing the president’s concerns and is committed to acquiring TikTok under the premise of conducting a thorough security review and providing appropriate economic benefits to the US government, including the Treasury Department.
Microsoft will move quickly to advance the discussion with TikTok’s parent company Bytedance within a few weeks. In any case, the discussion must be completed no later than September 15, 2020. In this process, Microsoft looks forward to continuing dialogue with the US government, including President Trump.
The new structure will be based on the experience currently loved by TikTok users, while adding world-class security, privacy, and digital security protection. The establishment of this operating model aims to ensure that TikTok maintains transparency to users and is subject to appropriate security supervision by the government in these countries.
Among other measures, Microsoft will ensure that all private data of TikTok US users is transferred to the US and retained in the US. For any data currently stored or backed up outside the United States, Microsoft will ensure that the data will be deleted from servers outside the United States after being transferred to the United States.
Earlier, yesterday evening, Bytedance issued a statement on its headline number, saying, “Bytedance has always been committed to becoming a global company. In this process, we are faced with various complex and unimaginable difficulties. Including the tense international political environment, the collision and conflict of different cultures, the plagiarism and smear of competitor Facebook . But we still adhere to the vision of globalization, and continue to increase investment in markets around the world, including China, to create value for global users . We strictly abide by local laws and will actively use the rights granted to us by the law to safeguard the legal rights and interests of the company.”
As the most successful product of a Chinese technology company going overseas, ByteDance’s TikTok has experienced the darkest moment recently. Since the end of 2017, Zhang Yiming, the founder of ByteDance, announced the acquisition of musical.ly for US$1 billion, and then integrated it with TikTok, Douyin’s overseas business. TikTok has become the most popular among young people in the US market in a short time. DAU once surpassed American social platforms such as Facebook and Snapchat.
Especially in the first half of this year, SensorTower data showed that TikTok ranked first with nearly 600 million downloads, and it is also the most popular overseas mobile application in the first half of 2020. In March of this year, as many countries around the world entered a state of lockdown due to the epidemic, TikTok downloads surged to 115 million times. Since then, the number of downloads in April and May has remained over 100 million.
In terms of growth rate, TikTok also maintained its momentum in the first half of this year, with downloads increasing by 88.7% over the same period last year. The top three markets are India, Brazil and the United States, accounting for 27.5%, 9.6% and 8.2% respectively. Overseas, TikTok is still undergoing rapid fission, becoming an important channel for young users to record and share their lives.
At the same time, TikTok has great potential in the space of commercialization. In June 2020, TikTok attracted more than US$90.7 million in global App Store and Google Play, which was 8.3 times that of June last year. TikTok once again won the global mobile application (non-game) revenue list. Although approximately 89% of its revenue comes from Douyin, its second-place revenue comes from the US market, contributing 6% of its revenue.
Unfortunately, under the interference of many forces, even Bytedance has shown sufficient localization “sincerity”, including the hired former Disney executive Kevin Mayer (Kevin Mayer) for Bytedance. The chief operating officer (COO) also serves as the global CEO of TikTok, handing over the highest authority of the US company, and it was also revealed that in the first three months of this year, he spent 300,000 US dollars on lobbying (the last quarter Three times), the above measures still failed to prevent the White House from being full of malice against it, becoming a pawn in a certain struggle.
The United States has already used administrative means to rub TikTok on the ground in all directions. Since last December, the Pentagon issued a warning to delete TikTok from all military smartphones. On Saturday, Trump clearly stated in an interview with reporters on Air Force One that he would “use administrative means” to prohibit TikTok from Use in the United States.
Faced with such a serious threat, according to Reuters, Bytedance and Zhang Yiming have decided to sell all their shares and completely divest TikTok’s US business.
In a passive situation, selling TikTok to Microsoft may be the best choice. This can not only withdraw a sum of money to make up for the loss of the previous investment in the US market (the current investor valuation of TikTok is about 50 billion US dollars, although it may reach a market value of 100 billion), more importantly, Microsoft is acquiring The strategy has always been relatively mild. It can be expected that in a short period of time, TikTok and its team may not have much change. Three years ago, Microsoft’s acquisition of the workplace social product LinkedIn for $26 billion is a typical example.
The experience of ByteDance being forced to sell its most successful products. For technology companies, especially Chinese technology companies, there is no winner in this competition. For technology companies in the United States, the White House today bans TikTok in the name of so-called privacy and security. Tomorrow, it will be possible to apply the same method to products of other technology companies.