Microsoft’s ongoing interest in acquiring TikTok marks a significant chapter in the global battle over technology, data security, and international trade relations. The video-sharing platform, owned by Chinese tech giant ByteDance, has faced multiple attempts by U.S. authorities to force its divestiture over national security concerns. This article provides a comprehensive history of Microsoft’s involvement with TikTok, the legal and political challenges the platform has faced, and what this potential acquisition means for the future of social media and U.S.-China tech relations.
The Origins of TikTok and U.S. Concerns
TikTok was launched internationally in 2018 after ByteDance merged its app, Musical.ly, with Douyin (the Chinese version of TikTok). The platform quickly gained traction, becoming one of the most downloaded apps globally, with over 1 billion active users, including 170 million in the U.S.
However, TikTok’s rapid expansion raised concerns in Washington. Lawmakers feared that ByteDance, being a Chinese company, could be compelled by the Chinese Communist Party to hand over U.S. user data. There were also worries that TikTok’s algorithm could be manipulated to spread misinformation or censor content unfavorable to Beijing.
These concerns culminated in executive actions under both the Trump and Biden administrations, leading to legal battles and multiple legislative efforts to either ban or force a sale of TikTok’s U.S. operations.
Microsoft’s First Attempt to Acquire TikTok in 2020
In August 2020, then-President Donald Trump issued an executive order demanding that ByteDance divest TikTok’s U.S. operations within 90 days or face a nationwide ban. The order cited national security concerns, claiming that TikTok’s data collection practices posed a risk to American users.
Microsoft quickly emerged as a leading contender to acquire TikTok’s U.S. business. Talks were held between Microsoft, ByteDance, and U.S. officials to facilitate a deal. The negotiations were complex, with discussions around data security measures, algorithm control, and potential partnerships with other American firms like Walmart and Oracle.
However, the deal collapsed in September 2020 when ByteDance rejected Microsoft’s bid, instead opting for a partnership with Oracle and Walmart, which never fully materialized. The acquisition talks ultimately faded as the Trump administration’s push to ban TikTok lost momentum.
Renewed U.S. Pressure and Microsoft’s Second Bid in 2024-2025
After taking office, President Joe Biden maintained pressure on TikTok but took a less aggressive approach than Trump. However, concerns over data security remained. In early 2024, bipartisan legislation was introduced that would require ByteDance to sell TikTok or face a complete ban.
In January 2025, after returning to office, Trump signed an executive order delaying the enforcement of the TikTok ban by 75 days, citing the need to facilitate a sale rather than immediately shutting down the platform. Microsoft, once again, emerged as a leading bidder.
Unlike in 2020, this time Microsoft is facing competition from other major players. AI startup Perplexity AI has proposed a joint venture with the U.S. government, while Trump has floated the idea of figures like Elon Musk or Larry Ellison acquiring the platform.
Why Microsoft Wants TikTok
Microsoft’s interest in TikTok stems from multiple strategic advantages:
- Expanding Social Media Presence: While Microsoft owns LinkedIn, it lacks a mainstream consumer-focused social media platform. Acquiring TikTok would give Microsoft a foothold in the highly lucrative short-form video market.
- AI and Cloud Growth: TikTok relies heavily on artificial intelligence for its content recommendation algorithm. Integrating TikTok’s technology could enhance Microsoft’s AI capabilities and strengthen its cloud services, particularly Azure.
- Ad Revenue and User Data: TikTok generates billions in ad revenue. Owning the platform would allow Microsoft to tap into a massive advertising market while leveraging user data to refine its products and services.
- Regulatory Leverage: A U.S. company owning TikTok’s American operations could ease government concerns over data security, making it easier for the platform to operate without political interference.
Challenges Facing the Acquisition
Despite Microsoft’s advantages, several hurdles could complicate the acquisition process:
- Regulatory Scrutiny: Any acquisition would require approval from both U.S. and Chinese regulators. The Chinese government has previously expressed reluctance to let ByteDance sell TikTok’s proprietary algorithm, which could complicate negotiations.
- Political Uncertainty: With Trump’s administration taking a hardline stance on China, Beijing may resist any forced sale of TikTok. A U.S.-mandated divestiture could escalate tensions between the two superpowers.
- Competition from Other Bidders: Microsoft is not the only interested party. Other tech giants and investment firms could enter the race, potentially driving up the price or creating legal obstacles.
- User Backlash: TikTok’s loyal user base may resist changes to the platform, particularly if a new owner alters content moderation policies or introduces significant modifications.
What Happens Next?
The next few months will be crucial in determining TikTok’s future in the U.S. The legislative and legal battles surrounding its ownership are likely to intensify. If Microsoft successfully acquires TikTok, it would mark one of the most significant tech acquisitions in history, reshaping the landscape of social media.
However, if ByteDance refuses to sell or if regulatory challenges stall the process, TikTok could face severe restrictions or an outright ban in the U.S. Either way, the platform’s fate remains uncertain as tech giants, governments, and investors watch closely.
Conclusion
Microsoft’s potential acquisition of TikTok represents a high-stakes battle over technology, data security, and geopolitical influence. As the saga unfolds, it will shape not only the future of TikTok but also the broader relationship between the U.S. and China in the digital age. Whether this deal succeeds or fails, it underscores the growing importance of tech sovereignty and the evolving challenges of regulating global digital platforms.
