There have been a number of interest in Chinese video sharing social network, TikTok from the US by other tech companies who think about purchasing the company as the US government stiffens it’s grips on the company.
But despite public negotiations, there seems to be some roadblocks to achieving this as reports from media outlets such as Reuters, Bloomberg, and The Wall Street Journal narrates there could be an algorithmic flaw on the TikTok’s For You page.
Proposed acquisitions came as tensions mount between both the US and China while the former accused the service of national security concerns which had prompted TikTok to do a number of things such as moving it’s server away from China.
Companies such as Microsoft, Oracle, Triller among others are eyeing the company in the US, Canada, New Zealand and Australia. But the details about the purchase isn’t yet known for sure but the video sharing service is estimated to be worth about US$30 billion while Microsoft is said to be on the verge of finalizing the deal by September 15th.
Meanwhile as more information of the potential acquisition piles up, there is a new concern arising over the algorithm of the service which on Friday was noted that a personalized content recommendation algorithms were added to a list of export controls by the Chinese government which we had earlier reported might have make the deal to hit a snag.
The new export controls mean that any recommendation algorithm — like the one that powers TikTok’s For You page — will need government approval before it can be sold to a foreign company. We don’t know exactly how China will interpret that clause, but the assumption from most observers is that the government will block the sale of the algorithm, presenting a huge problem for any potential deal.
What makes TikTok special is the “For You” page which is bombarded with tons of interesting contents and when that is gone, it could potentially damage the quality of the software by the time it get acquired by Microsoft. And the fact that more negotiation needs to be put in place meant that it would take longer before a better deal can be struck with the Chinese company.
One of the ways by which the American bidders could land a good deal which might be easier could be to get a license to use the algorithm as purchasing the service without the “For you” page is not going to make any sense and the Chinese government won’t probably agreed to just let it out just like that.
But with that, there have been more concerns about the Chinese government probably using the page for promoting propaganda and manipulating the feed while also could be a potential national security issue
The US President on the hand too won’t relax on his sanctions while making the deal much more complicated for the potential buyers. The president told reporters back on Tuesday that he in fact disregards the November 12th deadline set by his very on executive order while emphasizing the legally dicey idea which the US Treasury should receive payment as part of the deal.
“I told them they have until Sept. 15 to make a deal — after that we close it up in this country,” Trump said. “I said the United States has to be compensated, well compensated.”
What we don’t know now is whether there will be a variant of the social network application in other areas and regions while the US version will be different or the acquirer will simply just own the rights to everything in its entirety. But more of the story develops on the daily so we’ll surely follow up and report the more we see.