Microsoft’s rescue attempt of TikTok endears company to new generation

Tech

People walk past a Microsoft logo at the Microsoft office in Beijing, China August 4, 2020. REUTERS/Thomas Peter

REDMOND, Wash. (NewsNation) — Microsoft’s interest in acquiring TikTok is a boon to the young users of the social media service, who praised the tech industry giant for trying to buy parts of the social media company’s operations, in hopes of avoiding a U.S. shutdown.

Trending hashtags like #SaveTikTok and #Microsoft, have attracted nearly 1 billion views combined. TikTok’ers use the app to create short dance, lip-sync, comedy and talent videos and have embraced the venerated company, introducing it to a new generation.

In recent years, Microsoft has taken a hands-off approach to integrating new acquisitions, said Mike Vorhaus, chief executive of Vorhaus Advisors, a digital media consulting firm. For example, Microsoft left Minecraft’s team operating in Europe, he said.

“You don’t want to lose (TikTok’s) secret sauce, but you want them to gain from Microsoft,” he said.

A look at Microsoft’s track record on recent acquisitions, including building game Minecraft in 2014 and business networking site LinkedIn in 2016, could validate TikTok users’ optimism, analysts said.

Microsoft has largely abandoned its historic practice of tying all of its products back to its Windows operating system or other properties. Minecraft apps have no obvious connection to Microsoft. Its sales have quadrupled over the six years since it was acquired and it now reaches 126 million monthly users.

Under Satya Nadella, who took over as Microsoft CEO in 2014, the company purchased two large online communities that it has allowed to operate essentially autonomously. After acquiring business-oriented network LinkedIn for $26.2 billion, LinkedIn kept its brand identity, CEO and its own offices, while GitHub, the code-repository service acquired in 2018, has continued to build tools that help developers use Microsoft’s rivals.

JT Casey, a TikTok user with 2.8 million followers, said he was initially worried about the idea of Microsoft’s ownership, but concluded there is a potential change that could benefit video creators.

“I realized Microsoft will figure out a way to monetize better, which will lead to creators making more money, as well as Microsoft,” he said.

While TikTok’s fans are lauding Microsoft ownership as a possible solution to President Donald Trump’s potential ban over security concerns on how the Chinese-owned company handled user data, they are also considering moving to other social media platforms.

Dmitri Robinson, a 20-year-old TikTok user with more than 270,000 followers, said short-form video apps Triller and Byte are seen as the top two contenders for the next hottest app among friends and videos he has seen on TikTok.

On Friday, when Trump told reporters his administration was weighing action against TikTok as soon as that weekend, downloads for four TikTok rivals – Triller, Byte, Dubsmash and Likee – all spiked on Sunday, according to data from Apptopia. Daily downloads in the United States for Triller on Sunday almost doubled to nearly 62,000.

Facebook Inc’s Instagram is also readying the global launch of its TikTok rival, called Reels, which first debuted in Brazil in November.

Reporting by Sheila Dang; additional reporting by Paresh Dave and Stephen Nellis in San Francisco; for Reuters.

Reuters contributed to this report.

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