In a dramatic turn of events, Microsoft has entered into talks to acquire TikTok, the social media platform with approximately 170 million American users. This development comes as a U.S. law mandating ByteDance, TikTok's parent company, to divest its American operations took effect on January 19. The situation has garnered attention from President Donald Trump, who has expressed a desire to see a competitive bidding war over the platform.
Microsoft CEO Satya Nadella described the potential acquisition as "the strangest thing I've ever worked on." This isn't the first time Microsoft has been involved in negotiations to acquire TikTok; similar talks took place in 2020 but did not materialize into a deal. The current negotiations come against the backdrop of a specific set of requirements from the U.S. government for such a deal, though these requirements have reportedly vanished.
In addition to Microsoft's interest, AI startup Perplexity AI has proposed merging with TikTok, suggesting that the U.S. government could receive up to half of the new entity. President Trump, meanwhile, has indicated that he is in discussions with various parties about purchasing TikTok and expects to make a decision within 30 days. He has also signed an executive order delaying the enforcement of the divestment law by 75 days and mandated that TikTok separate its U.S. operations from ByteDance due to national security concerns.
The President's aspiration for a bidding war includes an openness to billionaire Elon Musk entering the fray if he so chooses. Trump's previous push for divestment ended when he left office, but the recent activity marks the second instance of Microsoft's potential acquisition of TikTok.