History repeats itself, quickly it seems, as U.S. President Trump confirms that Microsoft is indeed in the running to buy TikTok.
Over the weekend, we shared reports that Microsoft and Oracle were both vying to lock down TikTok. The Chinese social media giant has valuation estimates anywhere up to $100 billion owing to its proprietary algorithm — which is notorious for its addictive quality. TikTok is the de-facto king of social media these days, as younger generations shun Facebook and even Instagram in recent years, opting for the frenetic video-first formula TikTok offers.
Back in 2020, Microsoft was involved in previous talks to buy TikTok, which saw both cloud giant Oracle and even Walmart mull over an acquisition. At the time, Microsoft CEO Satya Nadella said it was “the strangest thing” he ever worked on. Indeed, the only reason parent company Bytedance was even considering a sale was due to a U.S. congressional push to bring the app’s operations into the western hemisphere. United States politicians argue that the app’s Chinese origins make it essentially a threat to national security. China bans western social media apps like Facebook and X from operating in its country, which some, including Tesla’s Elon Musk, argue creates an “imbalance.”
I have been against a TikTok ban for a long time, because it goes against freedom of speech. That said, the current situation where TikTok is allowed to operate in America, but đť•Ź is not allowed to operate in China is unbalanced. Something needs to change. https://t.co/YVu2hkZEVZJanuary 19, 2025
A new report from Reuters says that U.S. President Trump himself confirmed that Microsoft is in talks to buy TikTok outright. The United States Congress decreed that TikTok needs to sell its U.S. operations, or cease operating in the country. Incoming President Trump signed an executive order to give TikTok 75 days to work out some form of solution, which again, seems to involve either a complete or partial sale to a United States-based company.
Microsoft operates its own social network, LinkedIn, which is utilitarian in operation. LinkedIn revolves around careers and finding work, and isn’t exactly the cultural phenomenon that apps like TikTok or Instagram are. TikTok’s influence over global opinions, political trends, and marketing has been utterly undeniable in recent years. Some regulators like those in the European Union have been investigating whether or not TikTok’s algorithm is being abused by nation states to influence elections.
Other players interested in buying TikTok include cloud giant Oracle, which already hosts the company’s operations in the United States. Microsoft’s Azure platform hosts TikTok’s generative AI features, giving them an obvious tie-in. X owner Elon Musk has reportedly also been floated as a potential buyer, too.
Could Microsoft really buy TikTok?
TikTok was prepared to fully shut down the site rather than submit to a buyer just a few weeks ago, but now it seems a purchase could be a possibility. Whoever lands the social network is possibly looking at the most expensive tech acquisition in history, though, owing to the absolutely vast valuation Bytedance will doubtless argue for.
Indeed, former Microsoft CEO Bill Gates previously described the potential acquisition as a “poison chalice” for the firm. “It’s a poison chalice. Being big in the social media business is no simple game,” Gates remarked, noting the intense political scrutiny that comes with the industry. Microsoft is by no means a natural fit for social media, and has become rather poor at delivering consumer-oriented products in recent years. Microsoft famously fumbled Skype, which was, for a time, the primary way people communicated online.
The political nature of this deal is also doubtless tough to navigate. Microsoft is adept at playing the political game in Washington typically, but politicians from both sides of the aisle are questioning the power of “big tech” more and more. Vice President JD Vance said only yesterday that his administration believes that big tech firms have “too much power,” which seems at odds with the desire to hand Microsoft the most influential platform in the world.
I think the chances of Microsoft landing TikTok are probably quite low, owing in part to the above. It would be lucrative for them in the short term potentially, but Microsoft’s sluggish corporate culture precludes it from competing in fast-paced, consumer-oriented industries. Social media trends can turn on a dime, and Microsoft lacks that nimble sense of urgency, owing to its size.
… But hey, direct TikTok integration with Xbox and Windows could be pretty cool?
