Twitter buying TikTok makes better sense but faces same problems

JC Torres - Aug 10, 2020, 5:03 am CDT
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Twitter buying TikTok makes better sense but faces same problems

That the US government under President Trump wants to ban TikTok in the country is no surprise. That it wants TikTok to sell to a US company in order to escape that ban, a deal that includes giving the US Treasury some percentage, is not a shocker either. What was rather unexpected was that Microsoft is apparently so interested in buying up the popular short-video social network that CEO Satya Nadella personally talked with government officials about it. It turns out, Twitter is another prospective buyer and it might actually be a better fit for a TikTok owner. Presuming, of course, it could even buy it.

To be clear, not even the Wall Street Journal is sure about the tip. On the one hand, it almost makes sense considering Twitter and TikTok are birds of the same feather, at least as far as social media is concerned. Twitter also previously bought another short-video platform Vine, which unfortunately died under the management. Then again, TikTok exploded in ways Vine could have only dreamed of.

On the other hand, Twitter faces more obstacles than Microsoft, especially when it comes to finances. WSJ reports that Twitter’s market capitalization is only $29 billion against Microsoft’s $1.6 trillion. TikTok’s valuation, in comparison, is estimated to be in the tens of billions. Twitter will definitely need a lot of financial help to pull this off, but that’s probably the easiest part.

The difficult part would be dealing with the elephant in the room, the US government. The Trump administration wants to make giving money to the government a critical part of any negotiation. It will also most likely want to exert some influence or even indirect control over what TikTok would become in the hands of an American company. After all, that is one of the reasons why Trump wants TikTok sold off.

Twitter will definitely benefit from TikTok’s acquisition, even if it means significantly diverging from its core short-text nature. The social network giant is already under fire from Trump for restricting the latter’s posts over policy violations. Buying TikTok would mean it would come even under even greater scrutiny from the current administration who may feel it helped broker the deal it forced in the first place.


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