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Trump gives Microsoft 45 days to clinch TikTok deal

183 points by kumaranvpl 6y ago

mytailorisrich 6y ago
Strangely this is framed as an ultimatum to Microsoft when in fact it is one to Bytedance/Tiktok, and it obviously helps Microsoft.
- VWWHFSfQ 6y ago
  Yeah this is basically "sell to Microsoft or get banned". That obviously helps Microsoft's negotiating position.
- raverbashing 6y ago
  Correct Of course another company could come forward to buy it but it seems it's MS that has a foot on the door already
- deleted 6y ago
  [deleted]
kanox 6y ago
Forcing a foreign business to "sell or close" is an insult to the rule of law.
- redis_mlc 6y ago
  There's no law in China.
- rorykoehler 6y ago
  Not if China don't reciprocate the openness of the market (which they don't). Only fools will let them steamroll like that. I'm no Trump fan but this should have happened decades ago.
  - antonzabirko 6y ago
    Amen
  - kanox 6y ago
    Rule of law is not conditional on reciprocity.
    - rorykoehler 6y ago
      And vice versa. Rule of law is whatever the law makers decide the law will be. If they decide it is conditional on reciprocity then it is.
    - gwright 6y ago
      Rule of law is very important, but part of the problem is the "law" is pretty expansive with the powers it gives to the President. So I don't necessarily think there is a "rule of law" problem in this instance, but instead a problem with the extent of powers given to the federal government in general and to the President specifically. Disclaimer: I haven't read a good legal analysis of Trump's actions as of yet. This is a long standing problem with the size, scope, and complexity of our federal government. One of the things I do "enjoy" about Trump is how his actions gets everyone to argue for a less powerful federal government. It would be nice if these structural arguments weren't dependent on who was in the White House, but it is nice to hear them anyway.
- JumpCrisscross 6y ago
  > Forcing a foreign business to "sell or close" is an insult to the rule of law These powers are precedented—-this is how antitrust law works. The U.S. has had similar procedures in CFIUS since 1975 [1][2], which is likely how U.S. would enforce this decision. Keep in mind, it’s not sell or close. It’s an order to unwind the Musical.ly acquisition [3] or face sanctions. [1] https://en.m.wikipedia.org/wiki/Committee_on_Foreign_Investment_in_the_United_States https://en.m.wikipedia.org/wiki/Committee_on_Foreign_Investm... [2] https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment [3] https://hans.vc/bytedance-musical-ly-merger/ https://hans.vc/bytedance-musical-ly-merger/
  - scarface74 6y ago
    Since when could the President singlehandedly do it? Also, this has nothing to do with anti trust. How is TikTok a monopoly?
    - JumpCrisscross 6y ago
      > Since when could the President singlehandedly do it? Since 1988, when the Congress passed a law saying “all foreign investments that might affect national security may be reviewed and if deemed to pose a threat to security, the President of the United States may block the investment” [1]. [1] https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment
      - scarface74 6y ago
        “President Reagan delegated the review process to the Committee on Foreign Investment in the United States.“
        JumpCrisscross 6y ago
        > President Reagan delegated the review process to the Committee on Foreign Investment in the United States Delegating a power doesn’t remove one of that power. And CFIUS pre-dates Exon-Flores, so the Congress giving the President, not CFIUS, these powers is relevant. We can have a discussion as to whether we like or dislike this action. (I am not a fan.) But suggesting it’s unprecedented or a breakdown of the rule of law is hyperbolic.
- scarface74 6y ago
  There hasn’t been a rule of law in the US for four years. Congress and the judiciary have both been rubber stamping everything the President does. Yet and still this is the same government that for some strange reason many on HN trust to “regulate tech”.
  - JumpCrisscross 6y ago
    > Congress and the judiciary have both been rubber stamping everything the President does This is patently false—the U.S. has been losing court cases left and right [1]. [1] https://www.theatlantic.com/ideas/archive/2020/06/why-trump-keeps-losing-at-the-supreme-court/613315/ https://www.theatlantic.com/ideas/archive/2020/06/why-trump-...
    - scarface74 6y ago
      Yet and still. https://www.washingtonpost.com/opinions/trump-didnt-like-rulings-on-daca-so-hes-defying-them/2020/07/31/36458e06-d1e1-11ea-9038-af089b63ac21_story.html https://www.washingtonpost.com/opinions/trump-didnt-like-rul...
      - JumpCrisscross 6y ago
        One case, and the defiance is four days old. The injured will be able to get equity and injunctions in court. Not a valid argument for equivalence with Xi’s regime.
        scarface74 6y ago
        From who? Judges in the same party with lifetime appointments? Is Congress going to condemn it?
        JumpCrisscross 6y ago
        > Judges in the same party with lifetime appointments? Gorsuch recently ruled against Trump on gay rights [1]. As have several Bush appointees on other matters. Party isn’t a perfect prism for predicting court opinions. [1] https://www.nytimes.com/2020/06/15/us/politics/gorsuch-supreme-court-gay-transgender-rights.html https://www.nytimes.com/2020/06/15/us/politics/gorsuch-supre...
- newbie578 6y ago
  And working with a country which enforces that practice for over 40 years is not? (China if you didn't notice). This is the only way to truly fight back to their own anti-competitive practices. Either that, or outright banning them from doing business until they change their own laws, and honestly I much prefer the second option, even though I can tolerate the current solution proposed by Trump.
  - croes 6y ago
    So you fight back by becoming more like China?
    - jessaustin 6y ago
      That'll show 'em!
    - hnxs 6y ago
      I know where you’re going with this, but let’s all reflect on how China is currently winning.
- dx034 6y ago
  Not if this is the only way to protect its citizens. Not saying it's the case here but forcing a company to sale it's business to a local entity in order to proceed offering it on a local market isn't unheard of and can make sense.
  - amf12 6y ago
    > Not if this is the only way to protect its citizens. There are other ways, like enacting laws mandating data storage be in the US.
    - diebeforei485 6y ago
      If China-based engineers have access to TikTok's US-based servers, they can still hand over data to the CCP (or be forced to do so). The only way out is to move engineering, SRE, and testing out of China and hard-fork the codebase.
      - amf12 6y ago
        > If China-based engineers have access to TikTok's US-based servers, they can still hand over data to the CCP (or be forced to do so). 1. That is illegal. 2. Theoretically this also currently applies to Google, Microsoft, Google (any company which has devs in China) and is a solved problem. Almost all people don't have physical access to data, and those who do need to go through access reviews to do anything.
        eddieplan9 6y ago
        Quite the contrary: it’s illegal to not share data with government if requested: > Two pieces of legislation are of particular concern to governments — the 2017 National Intelligence Law and the 2014 Counter-Espionage Law. Article 7 of the first law states that "any organization or citizen shall support, assist and cooperate with the state intelligence work in accordance with the law," adding that the the state "protects" any individual and organization that aids it. Source: https://www.cnbc.com/2019/03/05/huawei-would-have-to-give-data-to-china-government-if-asked-experts.html https://www.cnbc.com/2019/03/05/huawei-would-have-to-give-da...
- ETHisso2017 6y ago
  The US government just took a large step towards becoming like China's today, at least in terms of how it oversees its technology industry.
- threeseed 6y ago
  What Trump is doing is completely within the law otherwise TikTok and its investors would simply file a lawsuit. And every day governments around the world block mergers and acquisitions on competition grounds and block companies from being involved in sensitive projects e.g. Huawei.
  - croes 6y ago
    Yeah, like they would a expect fair trial.
    - nathanaldensr 6y ago
      It's not a criminal proceeding. These are arbitrary powers granted to the President by Congress. If you want to change that, lobby your Congressperson to repeal the 1988 law mentioned elsewhere in this thread.
- IMTDb 6y ago
  This is not a "sell or close" it's a "cut ties with a foreign government or stop operating here". TikTok can continue operating, just not in the US.
  - rfoo 6y ago
    > cut ties with a foreign government or stop operating here How is it possible for someone to prove that they have no foreign government ties? Are there any evidence backing the "foreign government tie"?
    - IMTDb 6y ago
      Proving it might be hard. But a first step would be to get rid of its internal committee of the Chinese Communist Party. And to stop making joint venture with government agencies. To put it in other words, if there was a dedicated spot for the US secretary of defence on the board of Google, how fast do you think other countries would take some actions against Google ?
      - rfoo 6y ago
        > stop making joint venture with government agencies. Good point, I don't know they have JVs with government agencies before, had to do some research on this. > get rid of its internal committee of the Chinese Communist Party This is hard, if not impossible, if you meant "党委" ("party committee") or "党支部" ("party branch"), because CCP demands any organization with more than 3 party members SHOULD have one. ("should" should be interpreted roughly as the same word in RFC Requirement Levels) And just like they usually have no problem if people chose to deny joining the party but may hassle you forever if you quit, if you try to shutdown an existing "committee" it would be seen as hostile. That being said, most of the mid-to-large-sized startups are actively ignoring these requirements until being forced, because apparently even if you are required to do so, you have to go through a hairy application process. And the "committee" in most corps (including mega corps) are essentially an empty shell, a symbolic thing to make CCP happy, so corps usually have no motivation to change the status quo. Yet CCP do extremely care about these symbolic stuff, it is even forcing foreign companies to do this, IIRC Disney agreed to do so.
- tmaly 6y ago
  How does this compare to forced technology transfers of a companies IP?
- sdinsn 6y ago
  They aren't forcing it to sell or close. If the US bans TikTok, TikTok will still exist in other countries.
unionpivo 6y ago
I don't get it. Since when does one need permission of USA President to make the deal? I mean sure he could block the app in states, but I figure microsoft could still use it outside ?
- JumpCrisscross 6y ago
  > Since when does one need permission of USA President to make the deal? Since 1975 [1]. [1] https://en.m.wikipedia.org/wiki/Committee_on_Foreign_Investment_in_the_United_States https://en.m.wikipedia.org/wiki/Committee_on_Foreign_Investm...
  - scarface74 6y ago
    Notice that isn’t the President being able to act singlehandedly.
    - JumpCrisscross 6y ago
      CFIUS is a creature of executive action. And in 1988, the Congress passed a law saying “all foreign investments that might affect national security may be reviewed and if deemed to pose a threat to security, the President of the United States may block the investment” [1]. [1] https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment
      - valuearb 6y ago
        So all Tok Tok has to do is not sell and it’s scot free?
        Fjolsvith 6y ago
        What about advertising on TikTok?
        valuearb 6y ago
RavlaAlvar 6y ago
Why Microsoft though, is there other company competing for the deal?
- killjoywashere 6y ago
  I kind of wonder about this. The US Government pours money on Microsoft. The number of Windows servers in government reels the mind, and of course every desktop is Windows, with Office. They previously acquired LinkedIn, which is where a huge number of US citizens, and particularly military folks, park their resumes and roledexes. The LinkedIn social graph essentially subtracts children and stay-at-home spouses, making it somewhat denser with the type of information a foreign government might be interested in. Similarly, GitHub is of huge US national, probably Western strategic interest. I wouldn't be terribly surprised if some folks at Microsoft were "encouraged" to pursue those deals to keep them out of other hands.
  - scarface74 6y ago
    Who else? The President doesn’t like Facebook or Twitter anymore because they are both mean to him. This is the first step of what many on HN have been wanting - for the government to be more heavy handed toward tech. To everyone’s surprise, politicians are corrupt and self serving.
  - marmaduke 6y ago
    > The LinkedIn social graph essentially subtracts children and stay-at-home spouses What does subtract here mean?
    - pluc 6y ago
      The same thing it means everywhere else - it's a social network _minus_ kids and housewives.
      - ethbro 6y ago
        (Also househusbands)
rohan1024 6y ago
Tiktok at this point should also sell their India business to Microsoft. It would make sense for Microsoft because their are millions of people in India who want TikTok back but don't want China associated with it. Also, I don't think Indian government would have any issue if it's Microsoft.
- bilbo0s 6y ago
  More money in the US Tik Tok audience to be perfectly frank. MS has to be reasonably certain they will get their investment out plus some profit. Not only that, but sometimes the MS's of the world won't even buy if the profit they will make is not large enough. I would think some Indian firm might want Tik Tok? Not really sure why no deal has been made there?
  - victorvation 6y ago
    I could see Jio making a play, especially with their recent injection(s) of capital.
- deleted 6y ago
  [deleted]
ETHisso2017 6y ago
The US has permanently lost China's technologists and entrepreneurs at this point. I'm seeing people in the tech industry advocating for Facebook to get secondary sanctions from China - as in, companies which operate in China are not allowed to do business with Facebook. Presumably, this would mean Apple and Google (via Android)...
- scarface74 6y ago
  Google doesn’t operate in China. Chinese Android phones have no Google Play services. They use AOSP.
  - ETHisso2017 6y ago
    Google works with tons of Chinese phone vendors to get Android on phones worldwide.
- tanilama 6y ago
  I don't think it will be effective to do this secondary sanctions. If Chinese company want to sell aboard then Facebook isn't something easy to circumvent. And they can always go to Singapore to do business with it, or find agency there. It is will be hard for government to monitor such activities. Facebook by all means is already banned.
- sdinsn 6y ago
  Facebook is banned in China... > The US has permanently lost China's technologists and entrepreneurs at this point. What? We never had them. China's economy is closed and state-controlled.
  - est 6y ago
    > China's economy is closed Well except Tesla and ExxonMobil just setup their WOFE in China.
- nouveaux 6y ago
  Websites blocked in China: https://en.wikipedia.org/wiki/List_of_websites_blocked_in_mainland_China https://en.wikipedia.org/wiki/List_of_websites_blocked_in_ma... The point of this reply is not to pass judgement on this action. The point is that plenty of business is done between China and America despite the ban. Plenty of business will continue after TikTok.
anthony_r 6y ago
What a shitshow.
- amir734jj 6y ago
  Well said
jrochkind1 6y ago
Well that sure improves Microsoft's negotiating position. They've actually been in discussions to purchase for months now. But the U.S. government comes along and says, actually, you better complete it soon, or the value of the U.S. business will be zero.
- ETHisso2017 6y ago
  Does anyone not see how fucked up this is?
  - ethbro 6y ago
    TikTok is well within their rights to close their US business. If they want access to the US market, perhaps they should take that up with their own government.
  - diebeforei485 6y ago
    ByteDance had the choice to seek CFIUS review when they purchased Musical.ly in 2017. But they didn't. What's happening to them is similar to what happened to Grindr.
    - deleted 6y ago
      [deleted]
  - keeganpoppen 6y ago
    seems a bit questionable to me as well, as it seems pretty close to just straight-up nationalizing them...
  - viklove 6y ago
    It's nice to see our government responding to the CCP appropriately for once.
  - tannhaeuser 6y ago
    It's totally fucked up. By the same reasoning ("national security"), any country that hasn't already can and will now sooner or later ban US-dominated social networks, especially when networks as they exist benefitted from US antitrust turning a blind eye towards large scale purchases. The EU court of justice has just ruled against "safe harbour" arguing that personal data can be turned over to US authorities without due process. Pulling a "deal you can't decline" also won't exactly help mutual investments. I believe the gravity of this hasn't been appreciated yet.
pluc 6y ago
How is TikTok's data policy any more acceptable if it's controlled by Microsoft? Is there a clause to change the source code and not make it tailored to the informational needs of the State?
disgu 6y ago
The fact that something, anything, can be declared a national security risk without offering any proof for it whatsoever should worry everyone. Pretty sure EU car manufacturers like Daimler or VW would like to buy up Tesla's European operations for cheap. Just need the government to simply declare them to be a national security threat and force them to sell or lose access to the largest market on the planet.
- puranjay 6y ago
  You can very well make the argument that all the cameras in Tesla's cars can be used for surveillance and hence, pose a threat to national security. No evidence needed - the precedence has been set.
- SV_BubbleTime 6y ago
  Wasn't it shown that TikTok (and LinkedIn to be fair) was accessing camera and/or clipboard when it didn't need to? I have no dog in this fight, but isn't there at least a little evidence that TikTok may be collecting data on a large scale? I haven't been following it all that closely, but I thought that's what the original bans for military members was about. Edit: So, yes, but that’s ok because others were too.
  - paxys 6y ago
    After the clipboard thing came to light people quickly found that a ton of major apps (including Reddit) were doing it as well.
  - mullingitover 6y ago
    > Wasn't it shown that TikTok (and LinkedIn to be fair) was accessing camera and/or clipboard when it didn't need to? There's a gigantic list of apps that were revealed to be accessing things like the clipboard in iOS 14. I just installed the beta, and I found that my credit union's app reads the clipboard every time I open it. My third-party reddit app does the same thing. TikTok doing it isn't really even news. There are dozens to hundreds of apps doing it, and it's likely a bug.
1f60c 6y ago
Am I the only one who doesn’t like anything about this one bit? Usually, the POTUS can’t tell private companies what to do.
- mantap 6y ago
  Only the smallest companies in PRC can really be described as "private". Everything else is by some means or another connected with the communist party.
  - knolax 6y ago
    In this thread we have on one side a public example of the state ordering a private corporation to do something, and on the other vague blanket accusations of state collusion that get parroted by HNers but never substantiated with any examples. How long can you keep up the cognitive dissonance?
    - lenkite 6y ago
      How many examples do you need ? Will you be satisfied by a dozen or a hundred ? Just asking in advance before compiling. I am afraid that your assertion of cognitive dissonance should be directed at yourself. Frankly, this research can be done by anyone who hasn't closed their minds to the matter. In China, all corporate decisions involve the CCP. http://archive.is/JpWSU http://archive.is/JpWSU https://www.theguardian.com/world/2019/jul/25/china-business-xi-jinping-communist-party-state-private-enterprise-huawei https://www.theguardian.com/world/2019/jul/25/china-business...
      - codedokode 6y ago
        What's wrong with Chinese company obeying Chinese laws?
        frequentnapper 6y ago
        Nothing, as long as they only operate in China.
walnuts110 6y ago
Trump is taking on Tiktok personally.. That Tulsa rally really got to him.
platetone 6y ago
How badly will Microsoft fuck this up once the deal is closed? I can't imagine they're going to be able to successfully make this app secure.
- deleted 6y ago
  [deleted]
enumjorge 6y ago
I still don’t understand what Microsoft is thinking. Facebook, Google, Twitter, and to some extent Apple have had to deal with content moderation headaches on their respective platforms. Especially when it comes to politics, it seems like un-winnable battle. Do nothing and you’ll get blamed for helping spread hate and propaganda. Do something and you’ll get blamed for violating free speech and censoring conservatives. As far as I know, Microsoft has so far avoided being on that hot seat. So why, now, get involved in the shit show that is social media? I still don’t understand why Trump has a beef with TikTok specifically, but if the rumors are true that this is payback for the prank they pulled on his first political rally, isn’t this whole thing political in nature? What if TikTok users continue to mess with Trump? I can imagine Trump now set his crosshairs on Microsoft. I don’t understand why you’d willingly put yourself in the middle of a controversy to buy a company that doesn’t exactly align with your current businesses. What am I missing?
- happytoexplain 6y ago
  Do you think, from a large company's point of view, being "on that hot seat" is not worth the potential profit of a successful social platform? From what I can see, these company's have taken very little actual damage from that controversy. The moral complaints do little to their bottom line, and government talks tough but does nothing. Pragmatically, I think it seems like owning one of these platforms has more pros than cons.
  - gowld 6y ago
    > government talks tough but does nothing ... except force sale of successful Chinese companies to allies of Trump.
- catalogia 6y ago
  I suspect that Microsoft wants to buy TikTok as a favor to the US Government. I view this as possibly a repeat of Ebay/Microsoft buying Skype as a favor to the US Government. If moderating TikTok is too much of a hassle, they'll probably just mismanage it into irrelevancy (having already accomplished their primary objective of satisfying the American government that TikTok isn't a threat to American interests (either commercial or national security.))
mullingitover 6y ago
Trump just openly demanded that the US government get a cut of the sale if it goes to Microsoft. If I were TikTok I'd be shopping the company to europeans just to avoid any further headaches. They'd still get access to the US market but wouldn't have to deal with the headache of a sale to a US company.
- katmannthree 6y ago
  Is that normal? I haven't heard of that happening before and it feels really weird.
  - jonathankoren 6y ago
    No, and when pressed on the point, he deflected. There's no authority -- presidential, or otherwise -- to "ban" TikTok, nor enforce a sale of a foreign entity to an American (The foreign investment act is about selling American companies to foreign companies, not Americans buying foreign countries.), nor is there any way for the federal government to get a cut of any sale. It's just typical Trump talking out of his ass. https://www.washingtonpost.com/business/2020/08/03/trump-microsoft-tiktok-treasury/ https://www.washingtonpost.com/business/2020/08/03/trump-mic...
- kevin_thibedeau 6y ago
  They should sell to Yandex. See Trumpie quiver in his boots.
deleted 6y ago
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deleted 6y ago
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onetimemanytime 6y ago
This smells. US should ban them or not. This pressure to sell cheaply has a third world country feeling
nouveaux 6y ago
For those who are against US retaliation to China, how do you propose competing when China forces transfer of IP, blacklists companies and people when they make public statements they do not like, and bans apps[1] when apps do not fall inline with China's unethical policies? (I'm being generous here when I say China bans apps for political reasons when they can easily ban to be anti competitive.) [1] https://en.wikipedia.org/wiki/List_of_websites_blocked_in_mainland_China https://en.wikipedia.org/wiki/List_of_websites_blocked_in_ma...
- robert_foss 6y ago
  While I have no solution to offer, having two instead of one walled garden protected by a Great Firewall is certainly worse.
  - nouveaux 6y ago
    Western democracies at some point need to stand up to the lopsided competitive landscapes. Its one thing if this is a small up and coming country. China being number 2 (or number 1 according to the Economist) in the world deserves push back. They can afford to let companies compete on a more equal playing field now.
    - robert_foss 6y ago
      The US is no victim here, it has maintained its hegemony for 70 years. Maybe it is time for something else. I realize the people who have lived most of their lives in the US don't see the downsides of its hegemony, but rest assured that it is seen far more clearly elsewhere.
      - dodobirdlord 6y ago
        > Maybe it is time for something else. No thanks. It's been a while since the US government perpetrated a genocide. China, not so much.
        6y ago
rcgorton 6y ago
This seems to be a legitimate business move on the part of Microsoft. What is not legitimate is The-Donald/Twitler objecting simply because one of his rallies was oversubscribed by US Tik-Tok members. He is being a petulant toddler (ass-hat) and wants revenge.
ekrebs 6y ago
I'm confused about something and hope someone here can clear it up. A threat of stopping the sale unless the US gets paid "a substantial amount of money" sounds like extortion to me. Is there any precedence for the US getting cuts of acquisitions?
- tantalor 6y ago
  Yeah, it's called "taxes". When companies merge, they pay taxes on the value of the capital, stock or assets acquired during the process of a merger https://smallbusiness.chron.com/taxable-merger-22406.html https://smallbusiness.chron.com/taxable-merger-22406.html
  - valuearb 6y ago
    Foreign companies don’t owe the U.S. taxes when U.S. companies buy them.
    - bobwernstein 6y ago
      microsoft isn't foreign
      - valuearb 6y ago
        Microsoft isn’t getting bought.
        bobwernstein 6y ago
        exactly so Microsoft pays
- Natsu 6y ago
  There's this for presidential authority: https://www.law.cornell.edu/uscode/text/50/1702 https://www.law.cornell.edu/uscode/text/50/1702 I do not know on what basis they could therefore demand any payments, though.
nouveaux 6y ago
I think its important to note that this started November 1, 2019 by CFIUS[1]. While Trump is known for erratic behavior, he is acting on the investigation by CFIUS. [1] https://www.csis.org/blogs/trustee-china-hand/tiktok-clock-summary-cfiuss-investigation-bytedance https://www.csis.org/blogs/trustee-china-hand/tiktok-clock-s...
- valuearb 6y ago
  The CFIUS investigation has no basis, the acquisition took place years ago with no national security implications. Trump can’t do squat because anything he attempts will be blocked while it’s litigated far longer than the end of his only term.
- nouveaux 6y ago
  Ok so I'm merely stating facts here. Why the downvote?
  - burfog 6y ago
    Two guesses, one for each side of the political spectrum: 1. The word "erratic" suggests that there is error, rather than deliberate behavior to make the news and to throw enemies off guard. 2. You pointed out that the actions were in fact started by CFIUS, which is a disappointment to anybody who wants to see the actions as being driven by vanity or malice or corruption or similar.
justicezyx 6y ago
Sadly, the sentiment on HN showcases the inability of people to apply objective reasoning: The primary indicator I saw is the diminishing sentiment towards the injustice suffered by TikTok. At the very beginning, the sentiment that TikTok were mistreated was quite popular. Or even was the minstream [1,2]. Now, the sentiment has shifted that "why MSFT buy TikTok, why not TikTok sell to FB/Google". Like what's shown here. To this date, except the broad claim that "TikTok is owned by a Chinese company, and Chinese government will force TikTok to share private information", there isn't a single evidence that is even remotely relevant to national security. I am seeing a lot of US company executives are preparing to break from China very unpleasantly in the near future... [1] https://news.ycombinator.com/item?id=24016938 https://news.ycombinator.com/item?id=24016938 [2] https://news.ycombinator.com/item?id=23832183 https://news.ycombinator.com/item?id=23832183 [3] https://news.ycombinator.com/item?id=23755863 https://news.ycombinator.com/item?id=23755863
fatjokes 6y ago
Is it just me, or has there barely been a peep from the CCP about TikTok? When it came to Huawei or ZTE, China's gov't regularly engaged foreign gov'ts, but it seems that they don't care much for TikTok. If that is the case, and not just a case of it not being reported as prominently, I would put my conspiracy hat on: 1. TikTok is actually not cooperating with the Chinese gov't (and maybe this is the CCP's way of showing them that it goes both ways). 2. The CCP is allowing the US gov't to destroy its own credibility and moral high ground. These threads are usually solidly anti-China but there is a clear stream of discomfort now, with the realization that if national security can be used to override the law, and everything can be a national security threat, then how strong is the foundation of law? EDIT: A few of the replies have suggested 3) TikTok is simply not that valuable. Which makes all the ruckus being raised by banning it, whether by the US or by India, even sillier?
- TheSoftwareGuy 6y ago
  I think there is also a third option (might be a variant of #1): they are cooperating with the CCP, but the CCP does not value what TikTok provides them very highly, and so they don’t care enough to do much
  - tracker1 6y ago
    Or CCPs interest in what they get from TikTok doesn't provide much value internationally speaking. They may be more interested in domestic control in their "social credit" system to catch dissenters... where internationally, they would find less valuable information that they can act on. Just my own conspiracy minded pov. Also, most government and related businesses have already taken the steps to advise their employees don't use the app, and don't have it on devices that come into their offices.
- nihonde 6y ago
  Another theory (mine, as a TikTok user in Asia) is that American TikTok is not worth much compared to the rest of the app’s ecosystem, and therefore being “forced” to sell it is a windfall exit opportunity for Bytedance.
- 6y ago
Mupuff 6y ago
Can't TikTok just drag this along somehow till the upcoming elections? Trump has a very short attention span as-is.
yurlungur 6y ago
It's so ironic that mainstream opinions in the US are nowadays so ideologically charged that TikTok is assumed, without proof, to be 100% controlled by the Chinese government and therefore this forced takeover is justified one way or another. You see arguments all the time that start with "CCP is evil, X is Chinese, therefore...", which would basically justify any and every action against all Chinese entities. Meanwhile, if you have even close to a clue about what's going on in China you'd know that ByteDance is bending over backwards trying to position itself as a multinational corporation with independence from the Chinese government, all in utter futility of course. That action actually drew the ire from the mouthpieces of the party. Some rumors say that the reason TikTok announced the potential deal so fast is to make it so that the Chinese government won't intervene and turn it into another Huawei situation. Well, that kind of reasoning seems to be based on a purely fictional assumption that the US government is still operating on principal or in good faith.
- deleted 6y ago
  [deleted]
- mattwest 6y ago
  Can you elaborate on how ByteDance is trying to earn independence from the Chinese Gov? I'm genuinely just curious, to educate myself. From what I've read, they have a deep CCP governance and partnerships with Chinese state-owned media organizations.
  - yurlungur 6y ago
    You can probably try to find the English version of the memo in this news here: https://www.scmp.com/tech/apps-social/article/3095822/bytedance-founder-understands-disagrees-us-conclusion-tiktok-must https://www.scmp.com/tech/apps-social/article/3095822/byteda... But in any case. I did not say ByteDance is substantially moving towards independence from the Chinese government (what does that even mean, should it disobey laws in the country it's operating in?) and I'm not privy to any inside information as to how tightly integrated it is with the party. I'm just saying that it is trying to position itself as such.
mathattack 6y ago
Imagine if another country threatened to cancel an American company unless they merged with a local firm and paid a one-off bribe to the government.
- nimish 6y ago
  Boy have I got news for you about foreign direct investment regulations....
  - e9 6y ago
    Please do tell
    - dodobirdlord 6y ago
      This is, to begin with, essentially how operating in China works. Uber was forced to sell their Chinese operations to Didi Chuxing, AWS is prohibited from operating datacenters in China and forced into partnerships with local telecom companies, Google's services are uniformly banned. Operating in China means forming a partnership with a local company that you must turn over your IP to, before eventually you are kicked out of China so that the partner company can take your place entirely.
      - DiogenesKynikos 6y ago
        Uber wasn't forced to sell their operations. They were bleeding cash in their competition with Didi for Chinese market share, so they made a deal. Didi took over Uber's operations, and Uber got a 15% stake in Didi. Only certain sectors in China have joint-venture requirements. Over time, more and more sectors are being freed from those requirements. These sorts of regulations are allowed for developing countries under WTO rules.
    - nimish 6y ago
      India and China, along with basically every other country, have tons of regulations around how foreign companies can set up operations and invest in domestic markets. You cannot do business without a local partners in many industries (read: a "joint" venture in which the local "partner" will acquire your IP and eventually compete with you down the road). Foreign ownership is restricted. It was big news when China mildly liberalized its laws earlier this year and only as a gesture in the ongoing trade disputes.
jmspring 6y ago
Here is what Microsoft does (I don't speak for them, just what I would do): - secure the purchase - let it run independently like LinkedIn - move cloud components to Azure - leverage Microsoft compliance with regulators and data retention / collection plans - let tweens and teens do their thing Profit.
RandallBrown 6y ago
How exactly would an executive order ban an app? Obviously it's easy to make Apple and Google remove it from their app stores but couldn't ByteDance just release a new app called TokTik or something similar? Could ByteDance just reincorporate as a different company if the ban was at the company level? Would the order ban apps with > X Number of users when owned by foreign investors? Seems like this isn't something the president can actually do.
- btown 6y ago
  This blog, once you get past the clickbait title, goes over a lot of the mechanics: https://www.lawfareblog.com/tiktok-and-law-primer-case-you-need-explain-things-your-teenager https://www.lawfareblog.com/tiktok-and-law-primer-case-you-n... The short answer is that yes, it could be banned, but it would take a concerted effort by the White House.
creato 6y ago
People are thinking about this way too much in terms of personal data. I don't think this really is about that. Editorial control over what a significant fraction of people see is significant power over those people. Even seemingly benign editorial actions could have serious effects. Facebook and Twitter are clearly being pressured by all political sides to favor content they want favored and disfavor content they want disfavored. What does that look like when the CCP weighs in on what American TikTok users see? Maybe prioritizing posts about protests or just petty crime (even more so than the internet tends to do by itself)? I think there are endless ways to get creative and subtle here that could cause problems.
- Fjolsvith 6y ago
  Bingo. The conservative base on TikTok outnumbers the liberal base by nearly double.
  - shadowgovt 6y ago
    That runs counter to the Trump administration looking into banning it.
    - Fjolsvith 6y ago
      Hello. Half of what Trump says is to push a chess piece around the table where he wants it to go. You all think he's playing 2D checkers but he's really at Spock's chess level.
      - shadowgovt 6y ago
        Please. His algorithm isn't too hard to fathom. 1) Say whatever he feels like 2) If there's bad news, say something controversial to try and jam the news cycle. He's already had to back-peddle on claiming mail-in ballots increase voter fraud (https://www.google.com/amp/s/www.politico.com/amp/news/2020/08/04/trump-backtracks-mail-voting-florida-391373 https://www.google.com/amp/s/www.politico.com/amp/news/2020/...), probably because someone clued him in that the biggest user demographic for mail-in voting is the elderly, most of whom vote Republican.
dmix 6y ago
Interfering with business M&A using just a threat of action then asking for a piece of the $$ for the treasury dept sounds like something a Soviet/command economy would do. This is how you can tell when a right leaning group is significantly more authoritarian over liberty. Which is a divergence from many recent right leaning administrations in America (see: tea partiers) and the rest of the western world. Not to mention its oddly similar to the thing they are accusing the Chinese of doing.
rapnie 6y ago
What would the deal entail? Would MS get access to all the sourcecode, the IP behind it, etc? Would TikTok effectively be forked into two separate apps that evolve independently?
nnm 6y ago
MSFT stock rise about 5.62% (or $100b), likely due to the news to take over TikTok in US. If this is a fair trade, one would not expect MSFT stock to increase.
- corin_ 6y ago
  A bit of an over-simplification. A fair trade could cause the stock to rise if people think it will likely be unfair, or if people think that TikTok will be run better and more valuable in MS' hands, or that there's some synergy with other MS products/users to take advantage of, or because lots of investors might not move money from American stocks to Chinese but are happy to move money from being invested in other US tech companies into MSFT, or... etc.
gumby 6y ago
I hadn’t heard of “Key money” so I looked it up. Turns out it means an illegal bribe: https://www.brickunderground.com/blog/2015/11/what_is_key_money https://www.brickunderground.com/blog/2015/11/what_is_key_mo...
deleted 6y ago
[deleted]
ceeo 6y ago
OH MY GOD! Not a soul is talking about how this current US administration IS attempting to fleece and extort and FOREIGN company for MONETARY GAIN!? IS no one reading this NOT absolutely frightened at the sheer ridiculousness and absurdity of a sitting American president demanding gestapo, mafia like tactics against a company, no matter if its foreign OR Chinese?! How obtuse is the community to not even question the farce that TiKTok is somehow a security threat, and then take it at face value from an administration DEMONSTRABLY, PROVABLY emits falsehoods like a diesel engine from the 80's?!? WTF is going on my countrymen's f-cking minds?!? This president is pretending to be "El fuking* Chapo" and "nerds", techies, my people are saying this is "OK"?!? I WANT OFF THIS PLANET! Anyone who, after knowing all facts involved, thinks TikTok IS a national security risk and NOT FB, G, LinkedIN, etc. are a disgrace and lying in political servitude to a decrepit and dying ideology.

183 points by kumaranvpl 6y ago

Strangely this is framed as an ultimatum to Microsoft when in fact it is one to Bytedance/Tiktok, and it obviously helps Microsoft.

VWWHFSfQ 6y ago
Yeah this is basically "sell to Microsoft or get banned". That obviously helps Microsoft's negotiating position.
raverbashing 6y ago
Correct Of course another company could come forward to buy it but it seems it's MS that has a foot on the door already
deleted 6y ago
[deleted]

kanox 6y ago

Forcing a foreign business to "sell or close" is an insult to the rule of law.

redis_mlc 6y ago
There's no law in China.
rorykoehler 6y ago
Not if China don't reciprocate the openness of the market (which they don't). Only fools will let them steamroll like that. I'm no Trump fan but this should have happened decades ago.
- antonzabirko 6y ago
  Amen
- kanox 6y ago
  Rule of law is not conditional on reciprocity.
  - rorykoehler 6y ago
    And vice versa. Rule of law is whatever the law makers decide the law will be. If they decide it is conditional on reciprocity then it is.
  - gwright 6y ago
    Rule of law is very important, but part of the problem is the "law" is pretty expansive with the powers it gives to the President. So I don't necessarily think there is a "rule of law" problem in this instance, but instead a problem with the extent of powers given to the federal government in general and to the President specifically. Disclaimer: I haven't read a good legal analysis of Trump's actions as of yet. This is a long standing problem with the size, scope, and complexity of our federal government. One of the things I do "enjoy" about Trump is how his actions gets everyone to argue for a less powerful federal government. It would be nice if these structural arguments weren't dependent on who was in the White House, but it is nice to hear them anyway.
JumpCrisscross 6y ago
> Forcing a foreign business to "sell or close" is an insult to the rule of law These powers are precedented—-this is how antitrust law works. The U.S. has had similar procedures in CFIUS since 1975 [1][2], which is likely how U.S. would enforce this decision. Keep in mind, it’s not sell or close. It’s an order to unwind the Musical.ly acquisition [3] or face sanctions. [1] https://en.m.wikipedia.org/wiki/Committee_on_Foreign_Investment_in_the_United_States https://en.m.wikipedia.org/wiki/Committee_on_Foreign_Investm... [2] https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment [3] https://hans.vc/bytedance-musical-ly-merger/ https://hans.vc/bytedance-musical-ly-merger/
- scarface74 6y ago
  Since when could the President singlehandedly do it? Also, this has nothing to do with anti trust. How is TikTok a monopoly?
  - JumpCrisscross 6y ago
    > Since when could the President singlehandedly do it? Since 1988, when the Congress passed a law saying “all foreign investments that might affect national security may be reviewed and if deemed to pose a threat to security, the President of the United States may block the investment” [1]. [1] https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment
    - scarface74 6y ago
      “President Reagan delegated the review process to the Committee on Foreign Investment in the United States.“
      - JumpCrisscross 6y ago
        > President Reagan delegated the review process to the Committee on Foreign Investment in the United States Delegating a power doesn’t remove one of that power. And CFIUS pre-dates Exon-Flores, so the Congress giving the President, not CFIUS, these powers is relevant. We can have a discussion as to whether we like or dislike this action. (I am not a fan.) But suggesting it’s unprecedented or a breakdown of the rule of law is hyperbolic.
scarface74 6y ago
There hasn’t been a rule of law in the US for four years. Congress and the judiciary have both been rubber stamping everything the President does. Yet and still this is the same government that for some strange reason many on HN trust to “regulate tech”.
- JumpCrisscross 6y ago
  > Congress and the judiciary have both been rubber stamping everything the President does This is patently false—the U.S. has been losing court cases left and right [1]. [1] https://www.theatlantic.com/ideas/archive/2020/06/why-trump-keeps-losing-at-the-supreme-court/613315/ https://www.theatlantic.com/ideas/archive/2020/06/why-trump-...
  - scarface74 6y ago
    Yet and still. https://www.washingtonpost.com/opinions/trump-didnt-like-rulings-on-daca-so-hes-defying-them/2020/07/31/36458e06-d1e1-11ea-9038-af089b63ac21_story.html https://www.washingtonpost.com/opinions/trump-didnt-like-rul...
    - JumpCrisscross 6y ago
      One case, and the defiance is four days old. The injured will be able to get equity and injunctions in court. Not a valid argument for equivalence with Xi’s regime.
      - scarface74 6y ago
        From who? Judges in the same party with lifetime appointments? Is Congress going to condemn it?
        JumpCrisscross 6y ago
        > Judges in the same party with lifetime appointments? Gorsuch recently ruled against Trump on gay rights [1]. As have several Bush appointees on other matters. Party isn’t a perfect prism for predicting court opinions. [1] https://www.nytimes.com/2020/06/15/us/politics/gorsuch-supreme-court-gay-transgender-rights.html https://www.nytimes.com/2020/06/15/us/politics/gorsuch-supre...
newbie578 6y ago
And working with a country which enforces that practice for over 40 years is not? (China if you didn't notice). This is the only way to truly fight back to their own anti-competitive practices. Either that, or outright banning them from doing business until they change their own laws, and honestly I much prefer the second option, even though I can tolerate the current solution proposed by Trump.
- croes 6y ago
  So you fight back by becoming more like China?
  - jessaustin 6y ago
    That'll show 'em!
  - hnxs 6y ago
    I know where you’re going with this, but let’s all reflect on how China is currently winning.
dx034 6y ago
Not if this is the only way to protect its citizens. Not saying it's the case here but forcing a company to sale it's business to a local entity in order to proceed offering it on a local market isn't unheard of and can make sense.
- amf12 6y ago
  > Not if this is the only way to protect its citizens. There are other ways, like enacting laws mandating data storage be in the US.
  - diebeforei485 6y ago
    If China-based engineers have access to TikTok's US-based servers, they can still hand over data to the CCP (or be forced to do so). The only way out is to move engineering, SRE, and testing out of China and hard-fork the codebase.
    - amf12 6y ago
      > If China-based engineers have access to TikTok's US-based servers, they can still hand over data to the CCP (or be forced to do so). 1. That is illegal. 2. Theoretically this also currently applies to Google, Microsoft, Google (any company which has devs in China) and is a solved problem. Almost all people don't have physical access to data, and those who do need to go through access reviews to do anything.
      - eddieplan9 6y ago
        Quite the contrary: it’s illegal to not share data with government if requested: > Two pieces of legislation are of particular concern to governments — the 2017 National Intelligence Law and the 2014 Counter-Espionage Law. Article 7 of the first law states that "any organization or citizen shall support, assist and cooperate with the state intelligence work in accordance with the law," adding that the the state "protects" any individual and organization that aids it. Source: https://www.cnbc.com/2019/03/05/huawei-would-have-to-give-data-to-china-government-if-asked-experts.html https://www.cnbc.com/2019/03/05/huawei-would-have-to-give-da...
ETHisso2017 6y ago
The US government just took a large step towards becoming like China's today, at least in terms of how it oversees its technology industry.
threeseed 6y ago
What Trump is doing is completely within the law otherwise TikTok and its investors would simply file a lawsuit. And every day governments around the world block mergers and acquisitions on competition grounds and block companies from being involved in sensitive projects e.g. Huawei.
- croes 6y ago
  Yeah, like they would a expect fair trial.
  - nathanaldensr 6y ago
    It's not a criminal proceeding. These are arbitrary powers granted to the President by Congress. If you want to change that, lobby your Congressperson to repeal the 1988 law mentioned elsewhere in this thread.
IMTDb 6y ago
This is not a "sell or close" it's a "cut ties with a foreign government or stop operating here". TikTok can continue operating, just not in the US.
- rfoo 6y ago
  > cut ties with a foreign government or stop operating here How is it possible for someone to prove that they have no foreign government ties? Are there any evidence backing the "foreign government tie"?
  - IMTDb 6y ago
    Proving it might be hard. But a first step would be to get rid of its internal committee of the Chinese Communist Party. And to stop making joint venture with government agencies. To put it in other words, if there was a dedicated spot for the US secretary of defence on the board of Google, how fast do you think other countries would take some actions against Google ?
    - rfoo 6y ago
      > stop making joint venture with government agencies. Good point, I don't know they have JVs with government agencies before, had to do some research on this. > get rid of its internal committee of the Chinese Communist Party This is hard, if not impossible, if you meant "党委" ("party committee") or "党支部" ("party branch"), because CCP demands any organization with more than 3 party members SHOULD have one. ("should" should be interpreted roughly as the same word in RFC Requirement Levels) And just like they usually have no problem if people chose to deny joining the party but may hassle you forever if you quit, if you try to shutdown an existing "committee" it would be seen as hostile. That being said, most of the mid-to-large-sized startups are actively ignoring these requirements until being forced, because apparently even if you are required to do so, you have to go through a hairy application process. And the "committee" in most corps (including mega corps) are essentially an empty shell, a symbolic thing to make CCP happy, so corps usually have no motivation to change the status quo. Yet CCP do extremely care about these symbolic stuff, it is even forcing foreign companies to do this, IIRC Disney agreed to do so.
tmaly 6y ago
How does this compare to forced technology transfers of a companies IP?
sdinsn 6y ago
They aren't forcing it to sell or close. If the US bans TikTok, TikTok will still exist in other countries.

unionpivo 6y ago

I don't get it. Since when does one need permission of USA President to make the deal? I mean sure he could block the app in states, but I figure microsoft could still use it outside ?

JumpCrisscross 6y ago
> Since when does one need permission of USA President to make the deal? Since 1975 [1]. [1] https://en.m.wikipedia.org/wiki/Committee_on_Foreign_Investment_in_the_United_States https://en.m.wikipedia.org/wiki/Committee_on_Foreign_Investm...
- scarface74 6y ago
  Notice that isn’t the President being able to act singlehandedly.
  - JumpCrisscross 6y ago
    CFIUS is a creature of executive action. And in 1988, the Congress passed a law saying “all foreign investments that might affect national security may be reviewed and if deemed to pose a threat to security, the President of the United States may block the investment” [1]. [1] https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment https://en.m.wikipedia.org/wiki/Exon–Florio_Amendment
    - valuearb 6y ago
      So all Tok Tok has to do is not sell and it’s scot free?
      - Fjolsvith 6y ago
        What about advertising on TikTok?
        valuearb 6y ago

RavlaAlvar 6y ago

Why Microsoft though, is there other company competing for the deal?

killjoywashere 6y ago
I kind of wonder about this. The US Government pours money on Microsoft. The number of Windows servers in government reels the mind, and of course every desktop is Windows, with Office. They previously acquired LinkedIn, which is where a huge number of US citizens, and particularly military folks, park their resumes and roledexes. The LinkedIn social graph essentially subtracts children and stay-at-home spouses, making it somewhat denser with the type of information a foreign government might be interested in. Similarly, GitHub is of huge US national, probably Western strategic interest. I wouldn't be terribly surprised if some folks at Microsoft were "encouraged" to pursue those deals to keep them out of other hands.
- scarface74 6y ago
  Who else? The President doesn’t like Facebook or Twitter anymore because they are both mean to him. This is the first step of what many on HN have been wanting - for the government to be more heavy handed toward tech. To everyone’s surprise, politicians are corrupt and self serving.
- marmaduke 6y ago
  > The LinkedIn social graph essentially subtracts children and stay-at-home spouses What does subtract here mean?
  - pluc 6y ago
    The same thing it means everywhere else - it's a social network _minus_ kids and housewives.
    - ethbro 6y ago
      (Also househusbands)

rohan1024 6y ago

Tiktok at this point should also sell their India business to Microsoft. It would make sense for Microsoft because their are millions of people in India who want TikTok back but don't want China associated with it. Also, I don't think Indian government would have any issue if it's Microsoft.

bilbo0s 6y ago
More money in the US Tik Tok audience to be perfectly frank. MS has to be reasonably certain they will get their investment out plus some profit. Not only that, but sometimes the MS's of the world won't even buy if the profit they will make is not large enough. I would think some Indian firm might want Tik Tok? Not really sure why no deal has been made there?
- victorvation 6y ago
  I could see Jio making a play, especially with their recent injection(s) of capital.
deleted 6y ago
[deleted]

ETHisso2017 6y ago

The US has permanently lost China's technologists and entrepreneurs at this point. I'm seeing people in the tech industry advocating for Facebook to get secondary sanctions from China - as in, companies which operate in China are not allowed to do business with Facebook. Presumably, this would mean Apple and Google (via Android)...

scarface74 6y ago
Google doesn’t operate in China. Chinese Android phones have no Google Play services. They use AOSP.
- ETHisso2017 6y ago
  Google works with tons of Chinese phone vendors to get Android on phones worldwide.
tanilama 6y ago
I don't think it will be effective to do this secondary sanctions. If Chinese company want to sell aboard then Facebook isn't something easy to circumvent. And they can always go to Singapore to do business with it, or find agency there. It is will be hard for government to monitor such activities. Facebook by all means is already banned.
sdinsn 6y ago
Facebook is banned in China... > The US has permanently lost China's technologists and entrepreneurs at this point. What? We never had them. China's economy is closed and state-controlled.
- est 6y ago
  > China's economy is closed Well except Tesla and ExxonMobil just setup their WOFE in China.
nouveaux 6y ago
Websites blocked in China: https://en.wikipedia.org/wiki/List_of_websites_blocked_in_mainland_China https://en.wikipedia.org/wiki/List_of_websites_blocked_in_ma... The point of this reply is not to pass judgement on this action. The point is that plenty of business is done between China and America despite the ban. Plenty of business will continue after TikTok.

anthony_r 6y ago

What a shitshow.

amir734jj 6y ago
Well said

jrochkind1 6y ago

Well that sure improves Microsoft's negotiating position. They've actually been in discussions to purchase for months now. But the U.S. government comes along and says, actually, you better complete it soon, or the value of the U.S. business will be zero.

ETHisso2017 6y ago
Does anyone not see how fucked up this is?
- ethbro 6y ago
  TikTok is well within their rights to close their US business. If they want access to the US market, perhaps they should take that up with their own government.
- diebeforei485 6y ago
  ByteDance had the choice to seek CFIUS review when they purchased Musical.ly in 2017. But they didn't. What's happening to them is similar to what happened to Grindr.
  - deleted 6y ago
    [deleted]
- keeganpoppen 6y ago
  seems a bit questionable to me as well, as it seems pretty close to just straight-up nationalizing them...
- viklove 6y ago
  It's nice to see our government responding to the CCP appropriately for once.
- tannhaeuser 6y ago
  It's totally fucked up. By the same reasoning ("national security"), any country that hasn't already can and will now sooner or later ban US-dominated social networks, especially when networks as they exist benefitted from US antitrust turning a blind eye towards large scale purchases. The EU court of justice has just ruled against "safe harbour" arguing that personal data can be turned over to US authorities without due process. Pulling a "deal you can't decline" also won't exactly help mutual investments. I believe the gravity of this hasn't been appreciated yet.

pluc 6y ago

How is TikTok's data policy any more acceptable if it's controlled by Microsoft? Is there a clause to change the source code and not make it tailored to the informational needs of the State?

disgu 6y ago

The fact that something, anything, can be declared a national security risk without offering any proof for it whatsoever should worry everyone. Pretty sure EU car manufacturers like Daimler or VW would like to buy up Tesla's European operations for cheap. Just need the government to simply declare them to be a national security threat and force them to sell or lose access to the largest market on the planet.

puranjay 6y ago
You can very well make the argument that all the cameras in Tesla's cars can be used for surveillance and hence, pose a threat to national security. No evidence needed - the precedence has been set.
SV_BubbleTime 6y ago
Wasn't it shown that TikTok (and LinkedIn to be fair) was accessing camera and/or clipboard when it didn't need to? I have no dog in this fight, but isn't there at least a little evidence that TikTok may be collecting data on a large scale? I haven't been following it all that closely, but I thought that's what the original bans for military members was about. Edit: So, yes, but that’s ok because others were too.
- paxys 6y ago
  After the clipboard thing came to light people quickly found that a ton of major apps (including Reddit) were doing it as well.
- mullingitover 6y ago
  > Wasn't it shown that TikTok (and LinkedIn to be fair) was accessing camera and/or clipboard when it didn't need to? There's a gigantic list of apps that were revealed to be accessing things like the clipboard in iOS 14. I just installed the beta, and I found that my credit union's app reads the clipboard every time I open it. My third-party reddit app does the same thing. TikTok doing it isn't really even news. There are dozens to hundreds of apps doing it, and it's likely a bug.

1f60c 6y ago

Am I the only one who doesn’t like anything about this one bit? Usually, the POTUS can’t tell private companies what to do.

mantap 6y ago
Only the smallest companies in PRC can really be described as "private". Everything else is by some means or another connected with the communist party.
- knolax 6y ago
  In this thread we have on one side a public example of the state ordering a private corporation to do something, and on the other vague blanket accusations of state collusion that get parroted by HNers but never substantiated with any examples. How long can you keep up the cognitive dissonance?
  - lenkite 6y ago
    How many examples do you need ? Will you be satisfied by a dozen or a hundred ? Just asking in advance before compiling. I am afraid that your assertion of cognitive dissonance should be directed at yourself. Frankly, this research can be done by anyone who hasn't closed their minds to the matter. In China, all corporate decisions involve the CCP. http://archive.is/JpWSU http://archive.is/JpWSU https://www.theguardian.com/world/2019/jul/25/china-business-xi-jinping-communist-party-state-private-enterprise-huawei https://www.theguardian.com/world/2019/jul/25/china-business...
    - codedokode 6y ago
      What's wrong with Chinese company obeying Chinese laws?
      - frequentnapper 6y ago
        Nothing, as long as they only operate in China.

walnuts110 6y ago

Trump is taking on Tiktok personally.. That Tulsa rally really got to him.

platetone 6y ago

How badly will Microsoft fuck this up once the deal is closed? I can't imagine they're going to be able to successfully make this app secure.

deleted 6y ago
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enumjorge 6y ago

I still don’t understand what Microsoft is thinking. Facebook, Google, Twitter, and to some extent Apple have had to deal with content moderation headaches on their respective platforms. Especially when it comes to politics, it seems like un-winnable battle. Do nothing and you’ll get blamed for helping spread hate and propaganda. Do something and you’ll get blamed for violating free speech and censoring conservatives. As far as I know, Microsoft has so far avoided being on that hot seat. So why, now, get involved in the shit show that is social media? I still don’t understand why Trump has a beef with TikTok specifically, but if the rumors are true that this is payback for the prank they pulled on his first political rally, isn’t this whole thing political in nature? What if TikTok users continue to mess with Trump? I can imagine Trump now set his crosshairs on Microsoft. I don’t understand why you’d willingly put yourself in the middle of a controversy to buy a company that doesn’t exactly align with your current businesses. What am I missing?

happytoexplain 6y ago
Do you think, from a large company's point of view, being "on that hot seat" is not worth the potential profit of a successful social platform? From what I can see, these company's have taken very little actual damage from that controversy. The moral complaints do little to their bottom line, and government talks tough but does nothing. Pragmatically, I think it seems like owning one of these platforms has more pros than cons.
- gowld 6y ago
  > government talks tough but does nothing ... except force sale of successful Chinese companies to allies of Trump.
catalogia 6y ago
I suspect that Microsoft wants to buy TikTok as a favor to the US Government. I view this as possibly a repeat of Ebay/Microsoft buying Skype as a favor to the US Government. If moderating TikTok is too much of a hassle, they'll probably just mismanage it into irrelevancy (having already accomplished their primary objective of satisfying the American government that TikTok isn't a threat to American interests (either commercial or national security.))

mullingitover 6y ago

Trump just openly demanded that the US government get a cut of the sale if it goes to Microsoft. If I were TikTok I'd be shopping the company to europeans just to avoid any further headaches. They'd still get access to the US market but wouldn't have to deal with the headache of a sale to a US company.

katmannthree 6y ago
Is that normal? I haven't heard of that happening before and it feels really weird.
- jonathankoren 6y ago
  No, and when pressed on the point, he deflected. There's no authority -- presidential, or otherwise -- to "ban" TikTok, nor enforce a sale of a foreign entity to an American (The foreign investment act is about selling American companies to foreign companies, not Americans buying foreign countries.), nor is there any way for the federal government to get a cut of any sale. It's just typical Trump talking out of his ass. https://www.washingtonpost.com/business/2020/08/03/trump-microsoft-tiktok-treasury/ https://www.washingtonpost.com/business/2020/08/03/trump-mic...
kevin_thibedeau 6y ago
They should sell to Yandex. See Trumpie quiver in his boots.

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onetimemanytime 6y ago

This smells. US should ban them or not. This pressure to sell cheaply has a third world country feeling

nouveaux 6y ago

For those who are against US retaliation to China, how do you propose competing when China forces transfer of IP, blacklists companies and people when they make public statements they do not like, and bans apps[1] when apps do not fall inline with China's unethical policies? (I'm being generous here when I say China bans apps for political reasons when they can easily ban to be anti competitive.) [1] https://en.wikipedia.org/wiki/List_of_websites_blocked_in_mainland_China https://en.wikipedia.org/wiki/List_of_websites_blocked_in_ma...

robert_foss 6y ago
While I have no solution to offer, having two instead of one walled garden protected by a Great Firewall is certainly worse.
- nouveaux 6y ago
  Western democracies at some point need to stand up to the lopsided competitive landscapes. Its one thing if this is a small up and coming country. China being number 2 (or number 1 according to the Economist) in the world deserves push back. They can afford to let companies compete on a more equal playing field now.
  - robert_foss 6y ago
    The US is no victim here, it has maintained its hegemony for 70 years. Maybe it is time for something else. I realize the people who have lived most of their lives in the US don't see the downsides of its hegemony, but rest assured that it is seen far more clearly elsewhere.
    - dodobirdlord 6y ago
      > Maybe it is time for something else. No thanks. It's been a while since the US government perpetrated a genocide. China, not so much.
      - 6y ago

rcgorton 6y ago

This seems to be a legitimate business move on the part of Microsoft. What is not legitimate is The-Donald/Twitler objecting simply because one of his rallies was oversubscribed by US Tik-Tok members. He is being a petulant toddler (ass-hat) and wants revenge.

ekrebs 6y ago

I'm confused about something and hope someone here can clear it up. A threat of stopping the sale unless the US gets paid "a substantial amount of money" sounds like extortion to me. Is there any precedence for the US getting cuts of acquisitions?

tantalor 6y ago
Yeah, it's called "taxes". When companies merge, they pay taxes on the value of the capital, stock or assets acquired during the process of a merger https://smallbusiness.chron.com/taxable-merger-22406.html https://smallbusiness.chron.com/taxable-merger-22406.html
- valuearb 6y ago
  Foreign companies don’t owe the U.S. taxes when U.S. companies buy them.
  - bobwernstein 6y ago
    microsoft isn't foreign
    - valuearb 6y ago
      Microsoft isn’t getting bought.
      - bobwernstein 6y ago
        exactly so Microsoft pays
Natsu 6y ago
There's this for presidential authority: https://www.law.cornell.edu/uscode/text/50/1702 https://www.law.cornell.edu/uscode/text/50/1702 I do not know on what basis they could therefore demand any payments, though.

nouveaux 6y ago

I think its important to note that this started November 1, 2019 by CFIUS[1]. While Trump is known for erratic behavior, he is acting on the investigation by CFIUS. [1] https://www.csis.org/blogs/trustee-china-hand/tiktok-clock-summary-cfiuss-investigation-bytedance https://www.csis.org/blogs/trustee-china-hand/tiktok-clock-s...

valuearb 6y ago
The CFIUS investigation has no basis, the acquisition took place years ago with no national security implications. Trump can’t do squat because anything he attempts will be blocked while it’s litigated far longer than the end of his only term.
nouveaux 6y ago
Ok so I'm merely stating facts here. Why the downvote?
- burfog 6y ago
  Two guesses, one for each side of the political spectrum: 1. The word "erratic" suggests that there is error, rather than deliberate behavior to make the news and to throw enemies off guard. 2. You pointed out that the actions were in fact started by CFIUS, which is a disappointment to anybody who wants to see the actions as being driven by vanity or malice or corruption or similar.

justicezyx 6y ago

Sadly, the sentiment on HN showcases the inability of people to apply objective reasoning: The primary indicator I saw is the diminishing sentiment towards the injustice suffered by TikTok. At the very beginning, the sentiment that TikTok were mistreated was quite popular. Or even was the minstream [1,2]. Now, the sentiment has shifted that "why MSFT buy TikTok, why not TikTok sell to FB/Google". Like what's shown here. To this date, except the broad claim that "TikTok is owned by a Chinese company, and Chinese government will force TikTok to share private information", there isn't a single evidence that is even remotely relevant to national security. I am seeing a lot of US company executives are preparing to break from China very unpleasantly in the near future... [1] https://news.ycombinator.com/item?id=24016938 https://news.ycombinator.com/item?id=24016938 [2] https://news.ycombinator.com/item?id=23832183 https://news.ycombinator.com/item?id=23832183 [3] https://news.ycombinator.com/item?id=23755863 https://news.ycombinator.com/item?id=23755863

fatjokes 6y ago

Is it just me, or has there barely been a peep from the CCP about TikTok? When it came to Huawei or ZTE, China's gov't regularly engaged foreign gov'ts, but it seems that they don't care much for TikTok. If that is the case, and not just a case of it not being reported as prominently, I would put my conspiracy hat on: 1. TikTok is actually not cooperating with the Chinese gov't (and maybe this is the CCP's way of showing them that it goes both ways). 2. The CCP is allowing the US gov't to destroy its own credibility and moral high ground. These threads are usually solidly anti-China but there is a clear stream of discomfort now, with the realization that if national security can be used to override the law, and everything can be a national security threat, then how strong is the foundation of law? EDIT: A few of the replies have suggested 3) TikTok is simply not that valuable. Which makes all the ruckus being raised by banning it, whether by the US or by India, even sillier?

TheSoftwareGuy 6y ago
I think there is also a third option (might be a variant of #1): they are cooperating with the CCP, but the CCP does not value what TikTok provides them very highly, and so they don’t care enough to do much
- tracker1 6y ago
  Or CCPs interest in what they get from TikTok doesn't provide much value internationally speaking. They may be more interested in domestic control in their "social credit" system to catch dissenters... where internationally, they would find less valuable information that they can act on. Just my own conspiracy minded pov. Also, most government and related businesses have already taken the steps to advise their employees don't use the app, and don't have it on devices that come into their offices.
nihonde 6y ago
Another theory (mine, as a TikTok user in Asia) is that American TikTok is not worth much compared to the rest of the app’s ecosystem, and therefore being “forced” to sell it is a windfall exit opportunity for Bytedance.
6y ago

Mupuff 6y ago

Can't TikTok just drag this along somehow till the upcoming elections? Trump has a very short attention span as-is.

yurlungur 6y ago

It's so ironic that mainstream opinions in the US are nowadays so ideologically charged that TikTok is assumed, without proof, to be 100% controlled by the Chinese government and therefore this forced takeover is justified one way or another. You see arguments all the time that start with "CCP is evil, X is Chinese, therefore...", which would basically justify any and every action against all Chinese entities. Meanwhile, if you have even close to a clue about what's going on in China you'd know that ByteDance is bending over backwards trying to position itself as a multinational corporation with independence from the Chinese government, all in utter futility of course. That action actually drew the ire from the mouthpieces of the party. Some rumors say that the reason TikTok announced the potential deal so fast is to make it so that the Chinese government won't intervene and turn it into another Huawei situation. Well, that kind of reasoning seems to be based on a purely fictional assumption that the US government is still operating on principal or in good faith.

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mattwest 6y ago
Can you elaborate on how ByteDance is trying to earn independence from the Chinese Gov? I'm genuinely just curious, to educate myself. From what I've read, they have a deep CCP governance and partnerships with Chinese state-owned media organizations.
- yurlungur 6y ago
  You can probably try to find the English version of the memo in this news here: https://www.scmp.com/tech/apps-social/article/3095822/bytedance-founder-understands-disagrees-us-conclusion-tiktok-must https://www.scmp.com/tech/apps-social/article/3095822/byteda... But in any case. I did not say ByteDance is substantially moving towards independence from the Chinese government (what does that even mean, should it disobey laws in the country it's operating in?) and I'm not privy to any inside information as to how tightly integrated it is with the party. I'm just saying that it is trying to position itself as such.

mathattack 6y ago

Imagine if another country threatened to cancel an American company unless they merged with a local firm and paid a one-off bribe to the government.

nimish 6y ago
Boy have I got news for you about foreign direct investment regulations....
- e9 6y ago
  Please do tell
  - dodobirdlord 6y ago
    This is, to begin with, essentially how operating in China works. Uber was forced to sell their Chinese operations to Didi Chuxing, AWS is prohibited from operating datacenters in China and forced into partnerships with local telecom companies, Google's services are uniformly banned. Operating in China means forming a partnership with a local company that you must turn over your IP to, before eventually you are kicked out of China so that the partner company can take your place entirely.
    - DiogenesKynikos 6y ago
      Uber wasn't forced to sell their operations. They were bleeding cash in their competition with Didi for Chinese market share, so they made a deal. Didi took over Uber's operations, and Uber got a 15% stake in Didi. Only certain sectors in China have joint-venture requirements. Over time, more and more sectors are being freed from those requirements. These sorts of regulations are allowed for developing countries under WTO rules.
  - nimish 6y ago
    India and China, along with basically every other country, have tons of regulations around how foreign companies can set up operations and invest in domestic markets. You cannot do business without a local partners in many industries (read: a "joint" venture in which the local "partner" will acquire your IP and eventually compete with you down the road). Foreign ownership is restricted. It was big news when China mildly liberalized its laws earlier this year and only as a gesture in the ongoing trade disputes.

jmspring 6y ago

Here is what Microsoft does (I don't speak for them, just what I would do): - secure the purchase - let it run independently like LinkedIn - move cloud components to Azure - leverage Microsoft compliance with regulators and data retention / collection plans - let tweens and teens do their thing Profit.

RandallBrown 6y ago

How exactly would an executive order ban an app? Obviously it's easy to make Apple and Google remove it from their app stores but couldn't ByteDance just release a new app called TokTik or something similar? Could ByteDance just reincorporate as a different company if the ban was at the company level? Would the order ban apps with > X Number of users when owned by foreign investors? Seems like this isn't something the president can actually do.

btown 6y ago
This blog, once you get past the clickbait title, goes over a lot of the mechanics: https://www.lawfareblog.com/tiktok-and-law-primer-case-you-need-explain-things-your-teenager https://www.lawfareblog.com/tiktok-and-law-primer-case-you-n... The short answer is that yes, it could be banned, but it would take a concerted effort by the White House.

creato 6y ago

People are thinking about this way too much in terms of personal data. I don't think this really is about that. Editorial control over what a significant fraction of people see is significant power over those people. Even seemingly benign editorial actions could have serious effects. Facebook and Twitter are clearly being pressured by all political sides to favor content they want favored and disfavor content they want disfavored. What does that look like when the CCP weighs in on what American TikTok users see? Maybe prioritizing posts about protests or just petty crime (even more so than the internet tends to do by itself)? I think there are endless ways to get creative and subtle here that could cause problems.

Fjolsvith 6y ago
Bingo. The conservative base on TikTok outnumbers the liberal base by nearly double.
- shadowgovt 6y ago
  That runs counter to the Trump administration looking into banning it.
  - Fjolsvith 6y ago
    Hello. Half of what Trump says is to push a chess piece around the table where he wants it to go. You all think he's playing 2D checkers but he's really at Spock's chess level.
    - shadowgovt 6y ago
      Please. His algorithm isn't too hard to fathom. 1) Say whatever he feels like 2) If there's bad news, say something controversial to try and jam the news cycle. He's already had to back-peddle on claiming mail-in ballots increase voter fraud (https://www.google.com/amp/s/www.politico.com/amp/news/2020/08/04/trump-backtracks-mail-voting-florida-391373 https://www.google.com/amp/s/www.politico.com/amp/news/2020/...), probably because someone clued him in that the biggest user demographic for mail-in voting is the elderly, most of whom vote Republican.

dmix 6y ago

Interfering with business M&A using just a threat of action then asking for a piece of the $$ for the treasury dept sounds like something a Soviet/command economy would do. This is how you can tell when a right leaning group is significantly more authoritarian over liberty. Which is a divergence from many recent right leaning administrations in America (see: tea partiers) and the rest of the western world. Not to mention its oddly similar to the thing they are accusing the Chinese of doing.

rapnie 6y ago

What would the deal entail? Would MS get access to all the sourcecode, the IP behind it, etc? Would TikTok effectively be forked into two separate apps that evolve independently?

nnm 6y ago

MSFT stock rise about 5.62% (or $100b), likely due to the news to take over TikTok in US. If this is a fair trade, one would not expect MSFT stock to increase.

corin_ 6y ago
A bit of an over-simplification. A fair trade could cause the stock to rise if people think it will likely be unfair, or if people think that TikTok will be run better and more valuable in MS' hands, or that there's some synergy with other MS products/users to take advantage of, or because lots of investors might not move money from American stocks to Chinese but are happy to move money from being invested in other US tech companies into MSFT, or... etc.

gumby 6y ago

I hadn’t heard of “Key money” so I looked it up. Turns out it means an illegal bribe: https://www.brickunderground.com/blog/2015/11/what_is_key_money https://www.brickunderground.com/blog/2015/11/what_is_key_mo...

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ceeo 6y ago

OH MY GOD! Not a soul is talking about how this current US administration IS attempting to fleece and extort and FOREIGN company for MONETARY GAIN!? IS no one reading this NOT absolutely frightened at the sheer ridiculousness and absurdity of a sitting American president demanding gestapo, mafia like tactics against a company, no matter if its foreign OR Chinese?! How obtuse is the community to not even question the farce that TiKTok is somehow a security threat, and then take it at face value from an administration DEMONSTRABLY, PROVABLY emits falsehoods like a diesel engine from the 80's?!? WTF is going on my countrymen's f-cking minds?!? This president is pretending to be "El fuking* Chapo" and "nerds", techies, my people are saying this is "OK"?!? I WANT OFF THIS PLANET! Anyone who, after knowing all facts involved, thinks TikTok IS a national security risk and NOT FB, G, LinkedIN, etc. are a disgrace and lying in political servitude to a decrepit and dying ideology.