Would You Rather?November 12, 2020
TikTok has had a wild 2020 to say the least. The platform went from being an app for kids to hundreds of viral moments culminating in all the stars dry-snitching how they were all cheating on each other. It’s been a fun ride that is still up in the air. More recently growing data privacy and China’s soft power concerns have lead to threats of bans from various countries. India even pulled the trigger and banned the app early in July. President Trump has issued his latest threat in the form of a 45 day shot clock.
“Here’s the deal. I don’t mind if — whether it’s Microsoft or somebody else — a big company, a secure company, a very American company buys it,”
Microsoft began talks with Bytedance last week and is the front runner for the acquisition. Not only would the social media platform allow Microsoft to venture outside of their core B2B business, but they have also have the cash and enough regulatory freedom to do so. The question is will Bytedance even sell TikTok. Apparently the number floating around is $50 Billion which is certainly a lot more than the $1 Billion they paid to acquired Musically in 2017. However TikTok has much more market penetration and revenue than Musically ever had. When Cheetah Mobile sold a small stake of TikTok in a private deal, the company was valued at $141 Billion.
Outside of the financial consideration there is a huge geopolitical decision to be made by the Chinese Communist Party (CCP) who’s ultimately has final say over all Chinese business. We are obviously entering a Cold War with China if we are not already there. Is the CCP willing to die on this hill? Or are they going to take a quick L and wipe their tears with billions of dollars? With pretty much the whole world (US, EU, India, Brazil, Japan) against Chinese TikTok ownership IMO Bytedance/CCP will sell TikTok. If they don’t we are on the HOV lane straight to WWIII which the way 2020 is going is totally plausible as well…