Walmart and Microsoft Join Hands To Bid For TikTok, Fighting Against A Common Enemy: Amazon.
On Thursday, Walmart confirmed, that it will be teaming up with Microsoft, to bid for the purchase of TikTok. The step they took, is considered as a move forward in the direction to tackle Amazon; Amazon being a competitor for both. In the field of Cloud, Microsoft faces stiff competition from Amazon, whereas, Amazon growing e-commerce market is a threat to Walmart.
It is interesting to know that Microsoft and Walmart are already partners. They have a five-year contract to strengthen their businesses in the fight against a common enemy; Amazon.
It will be a long fight against Amazon! However, if they will fight together, they might get an edge over Amazon. If they succeed in occupying TikTok, they will have access to one of the biggest user databases, consisting of billions of users.
Daniel Newman, Futurum Research analyst, in a statement to Business Insider, clarified the situation, stating:
“With the demographic that TikTok serves, the e-commerce play that can tie to the riches of data being created on the platform will have a greater means to directly monetize with Walmart’s expansive online commerce and logistics experience.”
Though, according to Newman, teaming-up to purchase TikTok, can not be seen as a direct take to fight against Amazon. It is more like a small part of a larger picture; the larger picture, is yet to be revealed.
He also added that if the deal between Walmart, Microsoft and TikTok goes through, Amazon could strengthen its ties with Facebook and Instagram. It will lead to a bigger social media e-commerce market.
A statement released by Walmart showed a clear sign of excitement by the company. Walmart is planning to use the audience database of TikTok for advertisement and increasing its reach to more audiences.
The statement says: ‘We are confident that a Walmart and Microsoft partnership would meet both the expectations of U.S. TikTok users while satisfying the concerns of U.S. government regulators,’
No one can question the popularity of TikTok. In the U.S market, it has nearly 100 million users. However, the parent company ByteDance is under immense pressure by the government of the U.S. The U.S government is forcing ByteDance to either sell the company or quit business from the U.S, as it fears that the company is just a puppet for the Chinese government and it could be seen as a threat to the cybersecurity of the U.S.
It is not just Microsoft which is showing interest in TikTok. There are several other techs. Firms which are seeking to acquire the database of TikTok, Oracle is amongst one such big name.
The asking price for TikTok is yet not revealed by the parent firm ByteDance. However, it is reported by the Wall Street Journal that the value estimated is about $30 billion for the business of TikTok in the U.S.
Although, the bidders feel that TikTok is expecting too much for the business. Yet, no comments on this have been shared by the TikTok.
TikTok has always played smart and tried to portray a neutral outlook, hiding its roots which are in China. One such notable step was hiring Kevin Mayer as its American CEO for the business.
Unfortunately, Mayer did quit TikTok only completing just a few months of his service in the company. The reason given to the employees of the company was ‘political environment has sharply changed,’ which is indeed the truth.
ByteDance formed TikTok in 2017, they later bought Music.ly a video application which was very popular with kids in the US and Europe.
The U.S government fears that the Chinese application is sharing the data of its people with the Chinese government. However, the owners of the application deny any such claim.
With the U.S president determined to shut down the business of the Chinese application in the U.S. It would be impossible for TikTok to escape this without facing the damage.
President Trump has in a statement on August 18, stated that Oracle was ‘a great company’ that ‘could handle’ buying TikTok. However, he didn’t specifically comment on which one is the best (Microsoft or Oracle).
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