ByteDance, a Beijing-based multinational internet technology company, has finally thrown in the towel as it agreed to divest itself of a short video app called TikTok following President Trump’s threat to order ban of the app in the United States.
The ByteDance’s concession came amidst tensions between the U.S and China over issues of cyber security, trade, coronavirus spread, and China’s handling of Hong Kong’s autonomy.
President Trump while speaking to reporters onboard Air Force One on Friday said that he was going to order TikTok banned in the United States starting from Saturday.
The U.S has in recent time been critical of the app because it handles personal data of about 80 million U.S, users of the app, which the government said poses national risk to the country.
“The new deal would require Bytedance to forgo control of TikTok U.S. to the United States, while Microsoft would take control over TikTok’s U.S. user data,” sources said.
The sources further stated that some of the company’s investors who are based in the U.S could be given the chance to enjoy minority stake in the business since majority of the company’s investors are from the U.S.
Earlier before its decisions to concede to relinquish control of the app to the U.S. Bytedance had considered a series of options as pressure from the White House mounted.
As was earlier reported, most of Bytedance’s investors such as Sequoia and General Atlantic had earlier proposed that majority of ownership of TikTok be transferred to them at a value of $50 billion, an amount which the company’s executives agreed was beneath the monetary worth of the app.
However, Vanessa Pappas, TikTok U.S. general manager, said on Saturday in a video published on the app that TiKTok, which has about 80 million daily active U.S. users would continue to be around for as long as possible.
“We are here for the long run. Continue to share your voice here and let’s stand for TikTok.”