Social-Media
China could destroy TikTok's U.S. businesses, rather than have them sell.
The contentious attempt to compel Chinese tech unicorn ByteDance to divest part or all of its crack-down on TikTok 's social media business to a US-based firm may be in question after a study today suggests that China's government may reject the deal. According to Reuters, the Chinese government might choose TikTok to completely shut down its U.S. operations instead of allowing it to be sold to an American company.
TikTok 's proposed divestment is not a normal corporate activity. Instead, the U.S. government is seeking an arrangement, as President Donald Trump controls international and economic policy decisions by an executive order.
Leaning on his own fabled market acumen, the American prime minister even insisted that his country obtain a part of the final selling price. It is not clear if that definition is valid.
When the U.S. and China are sparring across the globe for both economic and diplomatic dominance, the agreement is a flashpoint between countries with a combination of businesses caught in the centre. ByteDance, along with Microsoft, Walmart and other smaller firms, including Oracle, is in the mix. The Trump administration set the deadline for an agreement to be concluded in mid-September, but as the month burns away, it is not clear if that deadline will be fulfilled.
The United States is not alone in taking action to counter Chinese interference within its borders, as the selling of TikTok comes after India has blocked the software, along with hundreds of other China-based applications.
The contract is also under pressure from a shifting regulatory climate in China, with the autocratic leadership of the country shifting its export laws to potentially include elements of TikTok that could restrict the agreement and likely scuttle its selling.
The case is a disaster for ByteDance. For Microsoft's lead-suitor, the arrangement is a family marriage that may not be completely enthused. It's an attempt at a power grab for the Trump administration.
And the agreement might sound like submission to China's newly oppressive regime. So, if the deal succeeds in getting together, it will come as more surprise than eventuality.
