When TikTok hired Kevin Mayer to be CEO in May, some viewed it as a ploy, a stunt if you will. That was due to the fact that the short-form video app was being attacked by the U.S. government for having a parent corporation based in China and Mayer had been working for Disney’s streaming service, Disney+. Yes, nothing screams Americana more than Disney and its iconic cartoon characters like Mickey M-O-U-S-E, Donald Duck, and Goofy.
But as the great Robert Zimmerman (you probably know him as Bob Dylan) once sang, “you don’t need a weatherman to know which way the wind blows.” Mayer knew that his days at TikTok were probably numbered since U.S. President Donald Trump was forcing ByteDance, the Chinese firm that owns TikTok, to divest the latter’s U.S. operations by September 15th or face a nationwide ban. Mayer composed a letter to his staff before departing in which he said that the CEO’s role at TikTok was expected to change dramatically. The Wall Street Journal saw a copy of the note which said, “I understand that the role that I signed up for—including running TikTok globally—will look very different as a result of the U.S. administration’s action to push for a selloff of the U.S. business. I’ve always been globally focused in my work, and leading a global team that includes TikTok U.S. was a big draw for me.”
The plan was for Mayer to announce his departure at the same time TikTok announced a sale. However, word of Mayer’s intentions leaked overnight forcing him to come clean about his intentions earlier than he had hoped. Several ByteDance staffers said that they were stunned by Mayer’s move and said that they didn’t see it coming.
As with many Chinese tech companies trying to operate in the U.S., the current administration accuses TikTok of being a national security threat because it might pass along to Beijing data obtained about U.S. consumers and corporations. ByteDance says that TikTok uses only two servers to store personal data with the main one in the U.S. and a backup server housed in Singapore.
But Mayer’s departure isn’t even the top story involving TikTok this morning. That’s because CNBC reports that a deal to sell the app’s operations in the U.S., Canada, Australia, and New Zealand could be announced as soon as next week. Those in the know say that Microsoft and Oracle are the leading contenders to close on a deal and that a final decision has yet to be made. Earlier, Twitter had explored making a bid as did a partnership made up of Walmart and SoftBank. The value of any deal could be in the range of $20 billion to $30 billion, but sources say that a final price has not been agreed on.
In an update to its story, CNBC quoted Walmart as saying that it might partner with Microsoft on a deal for TikTok. W Walmart spokesman said, “The way TikTok has integrated e-commerce and advertising capabilities in other markets is a clear benefit to creators and users in those markets. We believe a potential relationship with TikTok U.S. in partnership with Microsoft could add this key functionality and provide Walmart with an important way for us to reach and serve omnichannel customers as well as grow our third-party marketplace and advertising businesses. We are confident that a Walmart and Microsoft partnership would meet both the expectations of U.S. TikTok users while satisfying the concerns of US government regulators.”
TikTok has become very popular and was one of the top apps on the App Store and the Google Play Store even before the global pandemic helped pump up its numbers even more. With a large number of teens and pre-teens stuck inside during the peak of the summer, many turned to the app to pass the time. Users can record videos of 15 seconds or 60 seconds in length and content includes lip-syncs, dances, pranks, comedy, and more. In the states, TikTok has 100 million users with 800 million using the app worldwide. It has been installed more than 2 billion times from the App Store and the Google Play Store.
If no deal is reached and the U.S. government bans TikTok, 1,500 Americans will lose their jobs. TikTok also noted that as many as 10,000 Americans would lose the opportunity to be considered for new job opportunities working for the app.
