Redmond WA & Menlo Park, CA – Microsoft CEO Nadella Wades is trying to settle a merger with the social media platform TikTok in the United States. The video-sharing service’s American operations are owned by Chinese parent company ByteDance LTD. Benefits of this hypothetical deal would lead to an increase of 100,000,000 young users to Microsoft’s consumer base.
Additionally, Facebook’s Instagram has launched a new feature to compete with TikTok. The feature, Reels, allows users to record, edit, and combine short videos of themselves. This is in contrast to Instagram’s Stories feature, which took inspiration from Snap Inc.’s Snapchat. Chief Executive of TikTok, Kevin Mayer, wrote in a blog post that Reels was a copycat product and that TikTok is ready to face off against competing platforms.
The Microsoft-TikTok deal has made Microsoft move into a growing conflict between the US and China. President Trump has been criticized for believing that the US Treasury should be paid part of the purchasing price. Chinese Communist Party tabloid The Global Times has written that this deal represents the “looting of TikTok” by tech companies and the US government. Suffice to say, Microsoft has entered hot water.
But Microsoft has maintained good relations with both leaders in the US and China. The software company signed a $10,000,000,000 contract for cloud computing services. Nadella Wades also attended a tech summit hosted by Mr. Trump. On the flipside, the CEO has hosted China’s president Xi Jinping at Microsoft’s headquarters in 2015.
Despite Microsoft’s good standing in the United States and China, will its business relationships be tested as it tries to solidify a deal with TikTok? Will the rivalry between Instagram and TikTok continue to grow?
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