Microsoft has reportedly suspended its negotiations to buy TikTok after President Trump voiced his opposition to the deal. The Wall Street Journal reports that although the deal could still go, both parties will first try to understand why the Trump administration opposes the deal.
Microsoft on its part is also wary about any future government action against the Chinese-based video-sharing app.
President Trump had said that he was planning to ban TikTok from the US. “As far as TikTok is concerned, we’re banning them from the United States,” Trump told reporters on 31st July 2020.
According to Bloomberg, President Trump says he is ready to sign a document to order the ban either via executive order or emergency economic powers.
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WSJ also added that Microsoft had been in advanced talks with ByteDance prior to president Trump’s comments. ByteDance had agreed to sell its American operations to circumvent the Trump administration ban.
Under that arrangement, Microsoft would have been in charge of protecting TikTok’s US users’ data. The plan essentially would have allowed for another American company to take over TikTok operations in the US.
TikTok US General Manager Vanessa Pappas had said on 1st August 2020 that “[they’re] not planning on going anywhere” and that the company is “here for the long run.”
TikTok has been under scrutiny from the Trump administration over allegations that it was stealing US user data on behalf of China. US Secretary of State Mike Pompeo had compared the company to two other embattled Chinese companies, ZTE and Huawei. The three companies have repeatedly denied any wrongdoing, however, the Trump administration believes the contrary.
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