Microsoft, TikTok deal on hold as Donald Trump mulls US ban

US President Donald Trump has thrown a spanner in the works in a deal involving Microsoft and TikTok owner ByteDance to keep the company operating in America. Trump announced on Friday he intends to issue an executive order to ban TikTok in the US, citing national security concerns.

According to the Wall Street Journal, the parties are now ‘looking for clarity’ on the White House position on such a deal.

According to a report by Reuters, ByteDance had agreed to divest from its American operations, allowing Microsoft to take over management and protection of the data of US users. A third company would operate the company in the US.

The US alleges ByteDance could turn over Americans’ user data to the government in China, where it is headquartered. The US Army and Navy have already banned service members from downloading the app to government-issued phones. Earlier this month, the US House of Representatives also voted to bar the use of TikTok on all government-issued phones.

TikTok has vigorously defended its privacy controls. It has said its US user data is stored in the US with “strict controls on employee access.” In a statement, the company said, “We are committed to protecting our users’ privacy and safety as we continue working to bring joy to families and meaningful careers to those who create on our platform.”

ByteDance also touts its investment in the US to fend off some of the criticism. The company says it has hired 1,000 people in the country and intends to hire 10,000 more.

The US is not alone in taking action against TikTok. It, and hundreds of other apps, were banned in India following a border standoff between the two countries.

TikTok is a video-sharing social networking platform where users create short dance, lip-sync, comedy and talent videos. It has exploded in popularity especially among young people, with over 800 million monthly active users currently.

TikTok is facing increasing competition in the short-video genre. Facebook-owned Instagram will soon roll out its Reels service globally after trials in Brazil and India. YouTube announced last month it’s beginning to test a new feature on mobile that will allow users to record 15-second long multi-segment videos.

Read: Facebook to close its TikTok clone Lasso app this month