On Sunday, August 2, Microsoft acknowledged publicly and officially that Microsoft is in discussions regarding purchasing the U.S. operations of the TikTok video platform. Microsoft officials said via a blog post that Microsoft CEO Satya Nadella and President Donald Trump had met and Microsoft was “prepared to continue discussions to explore a purchase of TikTok in the United States.”
Microsoft “is 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 blog post said.
Microsoft is discussing both owning and operating TikTok in the U.S., Canada, Australia and New Zealand, officials said. Microsoft may invite other investors to take a minority share in the purchase.
Microsoft plans to continue discussions with TikTok’s parent company, ByteDance “ina matter of weeks” and will complete the discussions no later than September 15, 2020, officials said. During that time, Microsoft plans to continue discussions with the U.S. government, including Trump, the blog post said.
Microsoft would insure that it adds “world-class security, privacy and digital safety protections,” the blog post said. Microsoft also would ensure that all private data from TikTok’s U.S. users will be transferred to and remain in the U.S. If any of that data is currently stored or backed up outside the U.S., Microsoft would ensure it is deleted from servers outside the country after it is transferred, the blog post said.
TikTok claims its datacenters are located entirely outside China and that none of its data is subject to Chinese law. ByteDance operates a separate service called Douyin to serve the Chinese market. ByteDance currently operates its own hyperscale datacenters in the U.S., and stores all U.S. user data in the U.S., with backup redundnacy in Singapore, according to the company.
Microsoft officials characterized the discussions as “preliminary,” and noted that Microsoft does not intend to provide any further updates on the discussions until there is a definitive outcome.
On July 31, word that Microsoft was discussing the possibility of purchasing TikTok’s U.S. operations from ByteDance began circulating. Over the weekend, Microsoft was reported to have halted talks with ByteDance because of concerns that Trump might ban TikTok in the U.S.
It’s unclear exactly why Microsoft, which has become mostly an enterprise tech vendor, wants TikTok. It’s also unclear how much Microsoft will be willing to pay for it.