TikTok sale hits some bumps, but could still come soon, report says
Everyone who isn't Facebook, Twitter, YouTube or Snap seems to want a piece of TikTok.
Ian SherrFormer Editor at Large / News
Ian Sherr (he/him/his) grew up in the San Francisco Bay Area, so he's always had a connection to the tech world. At CNET, he wrote about Apple, Microsoft, VR, video games and internet troubles. Aside from writing, he tinkers with tech at home, is a longtime fencer -- the kind with swords -- and began woodworking during the pandemic.
Chinese tech giant ByteDance may be ready to give up its control of TikTok after all, with reports in recent days saying the social networking app's sale may be finalized soon.
A deal for TikTok's US, New Zealand and Australian operations is expected to be announced sometime in the near future, according to reports in CNBC, The Wall Street Journal and The New York Times, each citing sources who wished to remain anonymous. It is unclear how China's new rules on exporting technology might impact the deal, which some of the reports say could hinge on whether ByteDance sells the computer program that powers TikTok's recommendations and helps boost viral trends.
Walmart said in a statement last week that it believes TikTok's integration with advertising is a "clear benefit to creators and users in those markets" and offers an opportunity to bring a new spin to e-commerce.
"We believe a potential relationship with TikTok US in partnership with Microsoft could add this key functionality and provide Walmart with an important way for us to reach and serve [different types of] customers as well as grow our third-party marketplace and advertising businesses," Walmart said in the statement.
The video-focused social networking app has had a rocky past few months. The app has grown over the past year to more than 100 million users in the US and more than 2 billion downloads around the world, making it a cultural phenomenon particularly among teenagers. Its short-video format has helped dance and comedy sketches go viral both on its service as well as on Twitter, Facebook and Instagram.
That popularity, though, has been blunted by announcements from a succession of US government agencies, the military, Congress and the White House warning that TikTok poses a national security risk, in part because its owner, ByteDance, is a Chinese company. The argument is that ByteDance, via TikTok, collects reams of user data and that this can be used by China's ruling Communist party against US interests.
President Donald Trump said he intends to ban the app from the US by early November unless it's purchased by an American company, touching off an odd acquisition process among the tech industry's largest non-social networking companies, particularly Microsoft.
"The spread in the United States of mobile applications developed and owned by companies in the People's Republic of China continues to threaten the national security, foreign policy, and economy of the United States," Trump said in his initial executive order on Aug. 6 announcing the upcoming ban. "At this time, action must be taken to address the threat posed by one mobile application in particular, TikTok."
In a legally questionable move, Trump has since demanded the entire app be sold, not just its US operations, and that he wants a "very big proportion" of the sale to go to the US Treasury. Legal experts question whether he can make such demands, and TikTok has since sued claiming that the "executive order is not rooted in bona fide national security concerns."