The Controversy With Massive TikTok Deal
September 17, 2020
TikTok has become one of the most popular video sharing platforms in the world but it hasn’t been without growing pains.
President Donald Trump told reporters on Wednesday he is not ready to approve a proposal from Chinese company ByteDance that would make Oracle a technology provider for ByteDance’s popular video-sharing app TikTok according to CNBC.
The president is demanding that the future agreement would include Bytedance losing its majority stake in the app. This stance has been taken in order to address the administration’s data privacy and national security concerns.
Under the China Internet Security Law, ByteDance is legally required to share all information they have with the Communist Party of China which has become a point of contention for the Trump administration.
However, the deal with Oracle seems to be a good marriage because Oracle offers cloud infrastructure that TikTok could use for data storage and hosting in the U.S.
Microsoft, a larger cloud provider, had been inquiring about an acquisition of TikTok’s assets in North America, Australia, and New Zealand but on Sunday said ByteDance had decided against a deal with Microsoft. In an executive order, it has been stated that TikTok must sell all of its U.S. assets to an American company or group of U.S investors by November 12th.
TikTok continues to be one of the most downloaded apps in the world:
In February 2019, TikTok reached its first billion downloads. The app took just under eight months to gain half a billion more. These figures are nothing short of impressive, considering that the app was launched only as recently as 2016.
Key TikTok Statistics:
- Average daily time on TikTok estimated at 45 minutes
- US users open TikTok an average of eight times a day, with sessions averaging just under 5 minutes
- TikTok 2019 revenue came to $176.9 million
- Only 9% of US internet users have used TikTok, with 5% more interested in using it; this rises to 49% for teenage users
- ByteDance became the world’s most highly-valued private startup, with a valuation of $78 billion after a SoftBank-led $3 billion investment round