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TikTok and Their Sale Deadline! (EP.15)

Updated: Oct 9

[Abstract]

In this episode, we are keeping you all updated on the sale of the app TikTok. In summary, the deadline to purchase TikTok is approaching on September 20th. Microsoft was the lead company being considered to purchase the social media company. Bytedance declined their offer, and Oracle, an American company is a clear leader for the purchase, even though it doesn’t seem to be a complete buyout. Google and Facebook have already released their direct competition to TikTok on their respective platforms.


Sources:

https://www.businessinsider.com/tiktok-surpasses-100-million-monthly-users-europe-2020-9

https://thenextweb.com/plugged/2020/09/15/youtube-officially-launches-its-own-tiktok-competitor-shorts/

https://www.bbc.com/news/business-54156997

https://www.businessinsider.com/how-instagram-reels-compares-to-tiktok-influencer-brand-deals-2020-9

https://www.cnn.com/2020/09/14/tech/tiktok-deadlines/index.html

https://techcrunch.com/2020/09/10/trump-says-deadline-for-tiktok-sale-wont-be-extended/

https://deadline.com/2020/08/tiktok-lawsuit-president-trump-administration-1203020962/

https://www.axios.com/tiktok-deal-september-deadline-029211a4-4b4b-48a4-8388-e28d36218f58.html

https://www.thestreet.com/investing/oracle-hits-record-high-as-trump-nears-tiktok-sale-decision

https://www.youtube.com/watch?v=7Gjn37mM9sA#action=share

https://www.wsj.com/articles/tiktok-plans-to-challenge-president-trumps-executive-order-11598140583?mod=hp_lead_pos2

https://edition.cnn.com/2020/09/10/politics/trump-tiktok-extension-executive-order/index.html



[Links]

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Google Podcasts: Click here

YouTube: Click here



[Talking Points]

The information in this episode comes from the Wall Street Journal, MSN, Business Insider, CNN, Microsoft, Deadline, Axios, and TechCrunch.


What’s happening with TikTok?


Last month President Trump made an executive order to ban the widely popular social media app TikTok over national security concerns because a Chinese owned company named Bytedance, created the app. Trump alleged that the company Bytedance can give the data from the app straight to the Chinese government. After the initial order, he allowed American companies to try and purchase the social media company and gave the deadline of September 20th.


(If you want to catch up, you can listen to episodes 5 & 11 at digitalgalaxypodcast.com)


TikTok's sale is only a couple days away, what kind of progress has been made in the sale?


Since we last discussed this, a lot has happened. In late August, Bytedance went to court with the U.S. Government to combat the legality of the ban. A representative from Bytedance was interviewed by the Wall Street Journal and had this to say, For nearly a year we have sought to engage in good faith to provide a constructive solution. What we encountered instead was a lack of due process as the Administration paid no attention to facts and tried to insert itself into negotiations between private businesses.”


So weeks and weeks passed, and there were many rumors about who would buy the popular app. Microsoft was the front runner for a long time, but Bytedance has recently declined their offer. According to MSN, "ByteDance let us know today they would not be selling TikTok's US operations to Microsoft. We are confident our proposal would have been good for TikTok's users while protecting national security interests. To do this, we would have made significant changes to ensure the service met the highest standards for security, privacy, online safety, and combatting disinformation, and we made these principles clear in our August statement."


The original deadline was supposed to be September 15th, giving Bytedance about 45 days to sell to an American company. The deadline was extended to September 20th, and there is no plan to extend any further. In an article by CNN, President Trump said, "We'll see what happens it'll either be closed up or they'll sell it"


There have been complications with moving further with the sale. According to TechCrunch, “the software code used in ByteDance’s apps, including TikTok, was developed by engineers and developers at its Beijing headquarters. This makes separating TikTok from ByteDance more complicated on a technical level.” So it seems like this could be tied up in court for a while, even past the proposed deadline. Justin, can you reveal to the crew who the top prospect for purchasing TikTok?


The American company Oracle is the company that is the top runner right now to purchase TikTok even though it would not be an outright sale. Oracle proposed that the company would create 20,000 jobs at a US headquarters after the acquisition. According to Business Insider, “Oracle would reportedly take over management and processing of TikTok's user data either in the US or globally — through Reuters and the Financial Times report different possibilities.” But they wouldn’t technically own the company, and Bytedance may still have oversight.


Will be enough of a proposal to satisfy the Presidents’ Executive order? There has been a lot of competition from other companies since this whole ordeal has been happening. Instagram, owned by Facebook, has launched its Reels service, which is extremely similar to TikTok. YouTube just launched its own service called shorts. So we’ll see if this deal will matter much if those other services gain steam.


In the meantime, Axios provides some possible scenarios for next week. “It's still unlikely TikTok would go offline next Wednesday, particularly given that it's already fighting Trump's executive order in court. It also may ask Apple and Google to remove TikTok from app stores, although it is unlikely to request any sort of forced removal from devices. If this doesn't soon get decided in a boardroom, it's going to get decided in a courtroom.”


We’ll keep a lookout, and keep you updated on the situation once the smoke clears, and the deadline passes.

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