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Microsoft reportedly puts TikTok acquisition talks on hold

Microsoft reportedly puts TikTok acquisition talks on hold


The Trump administration had threatened to ban the app for weeks

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Illustration by Alex Castro / The Verge

Talks between Microsoft and TikTok parent company ByteDance were paused after President Trump voiced his opposition to the deal, The Wall Street Journal reported Saturday. And while the deal does not appear to be dead, both parties are reportedly trying to get a handle on where the Trump administration stands, and if it plans any future action against the Chinese-based video sharing app.

President Trump told reporters Friday he was planning to ban TikTok from operating in the US. “As far as TikTok is concerned, we’re banning them from the United States,” Trump told reporters aboard Air Force One. Bloomberg reports the president said he was ready to sign a document to order the ban as early as today, either via an executive order or emergency economic powers.

“I will sign the document tomorrow,” he said on Friday night, indicating that a ban could take effect “essentially immediately.”

Microsoft was in advanced talks with ByteDance prior to the president’s comments, the WSJ said. Trump’s remarks led TikTok to agree to add 10,000 jobs in the US. Whether that will still hold after the president’s comment was unclear Saturday. A deal was possible as early as Monday, according to the WSJ.

Reuters reported Saturday that ByteDance had agreed to sell its American operations to prevent the Trump administration from banning it in the US, and, that Microsoft would be in charge of protecting US user data. The plan would have allowed another American company to take over TikTok in the US.

The administration has threatened to ban the video-sharing app for several weeks; Secretary of State Mike Pompeo said on July 7th a ban was “something we’re looking at.” President Trump said Friday “we’re banning them from the United States,” but didn’t provide specifics other than he planned to take action as early as Saturday.

TikTok US General Manager Vanessa Pappas said in a video on Saturday that “we’re not planning on going anywhere” and the company is “here for the long run.”

TikTok is a subsidiary of Beijing-based ByteDance, and has been scrutinized for its privacy practices and potential ties to China’s government. Pompeo has compared TikTok to Huawei and ZTE, two Chinese companies the Trump administration has designated as threats to US national security.

Last month, TikTok users and K-pop fans encouraged followers to buy tickets to President Trump’s rally in Tulsa but not show up, in an attempt to leave seats at the rally empty. Turnout for the rally was lower than the Trump campaign had expected.

Reports on Friday suggested the Trump administration would potentially force TikTok’s Chinese owner to divest it, and several published reports indicated Microsoft was in advanced talks to acquire the company.

US law doesn’t have any precedent for blocking software, the way China’s Great Firewall does.

UPDATE August 1st, 4:31PM ET: Adds information that the talks between Microsoft and ByteDance appear to be paused