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Temporary TikTok

TikTok: Even A Temporary Ban Could Make 90% Of Users Quit The App – NPR

In this photo illustration, a TikTok logo seen displayed on a smartphone with a ByteDance logo picture in the background.

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In this photo illustration, a TikTok logo seen displayed on a smartphone with a ByteDance logo picture in the background.

SOPA Images/SOPA Images/LightRocket via Gett

In a new court filing, TikTok leaders make clear just how much is at stake in a prolonged battle with the Trump administration: If TikTok were banned for two months, up to half of its users in America would never come back. If the ban persisted for six months, 90% of TikTok users would be gone forever, according to a top TikTok executive.

“We would not be able to make up for lost ground, because people who would have downloaded TikTok will have already turned to other competing platforms such as Byte, Triller, Zynn and the Reels feature on Instagram,” Vanessa Pappas, TikTok’s interim global head, wrote. Pappas’ submission was part of a TikTok lawsuit urging a federal judge to halt a ban on the app from Trump from taking effect on Sunday.

President Trump’s crusade to ban the popular video-sharing app in the U.S. has already cost TikTok millions of dollars in advertising revenue, made it more difficult to recruit new employees and, unless a federal court blocks Trump’s ban from taking effect this weekend, TikTok is facing “catastrophic economic loss,” Pappas said.

Just days ago, Trump indicated that a deal to keep TikTok alive had received his blessing. Under the terms, U.S. software company Oracle would gain control of TikTok’s U.S. user data and, together with Walmart, a one-fifth ownership stake in the app.

But soon TikTok’s Chinese parent company ByteDance, Oracle and Walmart released contradicting statements about key details of the deal, leading to confusion about the actual terms of the agreement and whether or not Trump will approve it.

Trump's TikTok Deal: What Just Happened And Why Does It Matter?

News of the apparent breakthrough led the Commerce Department to delay for a week its enforcement of Trump’s executive order outlawing business between U.S. citizens and TikTok.

But that order — which would make TikTok disappear from app stores and eventually cripple the app for those who already have it — is set to start now on midnight Sunday.

TikTok’s lawyers are asking for an emergency hearing to prevent the prohibition on TikTok from beginning this weekend. The Justice Department opposes the hearing. In a response to the court, it says while the ban prevents downloads and updates of the app, it will “otherwise largely preserve the status quo” for TikTok users in the U.S.

There is a consensus among Washington lawmakers of both parties that China-based technology companies could pose a national security risk. In its economic trade war with China, the Trump administration has taken aim at a number of Chinese technology firms, but officials in the White House have not provided concrete evidence that TikTok constitutes a specific threat.

Nonetheless, Trump has said that any deal to save TikTok would have to mean that ByteDance, TikTok’s corporate owner, has no power or control, a proposition the company does not appear willing to accept.

TikTok Ban Averted: Trump Gives Oracle-Walmart Deal His 'Blessing'

Lawyers for TikTok are asking a federal judge to block the order from taking effect, claiming, among other arguments, that Trump’s action violates users’ First Amendment rights.

The president ordered that Chinese-owned app WeChat be effectively shut down in the U.S. along with TikTok, but a federal judge recently blocked that ban over free speech concerns, saying such apps operate as a “a virtual public square.”

In the Wednesday court filing, Pappas, for the first time, spelled out the damage Trump’s clamp down already has caused.

A dozen brands have cancelled or delayed advertising on the app, costing TikTok $10 million in revenue in August alone, she said.

Hiring has become more difficult with a giant target from the White House on its back. Pappas said 52 candidates have declined offers to work at TikTok due to Trump’s attacks against the app.

At the same time, TikTok, which has some 100 million monthly active users in the U.S., has seen explosive growth. Pappas said before rumors started to circulate in July of a looming Trump ban, TikTok had been adding 424,000 new daily users in the U.S. every day.

Regulators in Washington have been conducting a security review of TikTok for more than a year. But in its filing to the court, TikTok lawyers say Trump seemed to step up pressure on the app following a prank in which many TikTok users reserved tickets to the president’s campaign kick-off rally in Tulsa, Okla, then failed to show up.

At any rate, TikTok’s attorneys wrote on Wednesday, Trump “began targeting TikTok, shortly after it surfaced in public reporting that TikTok users had claimed they used the app to coordinate mass ticket reservations for the President’s rally in Tulsa, resulting in an embarrassment for the President’s campaign,” according to lawyer John Hall, who is representing TikTok.

Shortly after, Hall writes, Secretary of State Mike Pompeo confirmed that the administration is “looking at” banning TikTok. Then the president’s re-election campaign ran negative Facebook advertisements urging supporters to sign a petition to ban TikTok.

The Trump campaign has denied the impact of TikTok users on attendance at the Tulsa rally, pointing out that registration was never capped since it was a first-come, first-serve event. Fears over the coronavirus, the Trump campaign says, is what really depressed turnout.

Editor’s note: TikTok helps fund NPR content that appears on the social media platform.

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Instagram TikTok

Instagram’s TikTok clone Reels updates to allow longer videos, easier edits – TechCrunch

Instagram is today rolling out a few changes to its TikTok competitor, Reels, after early reviews of the feature criticized its design and reports indicated it was failing to gain traction. The company says it’s responding to user feedback on a few fronts, by giving Reels users the ability to create longer videos, extend the timer, and by adding tools to trim and delete clips for easier editing.

TikTok helped popularize the short, 15-second video — its default setting. But its app also allows videos up to a minute in length, which is a popular option. Reels, however, launched with support for only the 15-second video. Not surprisingly, the Reels community of early adopters has been asking for the ability to create longer videos, similar to TikTok.

But Instagram isn’t giving them the full one minute. Instead, it’s adding the ability to create a Reel up to 30 seconds long. This could force users to create original content for Reels, instead of repurposing their longer TikTok videos on Instagram.

Image Credits: Instagram

The company says it will also now allow users to extend the timer up to 10 seconds and will allow users to trim and delete clips to make editing simpler.

“We continue to improve Reels based on people’s feedback, and these updates make it easier to create and edit. While it’s still early, we’re seeing a lot of entertaining, creative content,” said Instagram Reels Director, Tessa Lyons-Laing.

The tweaks to the video creation and editing process could help to simplify some of the more troublesome pain points, but don’t fully address the problems facing Reels.

What makes TikTok so easy to use is that you don’t have to be a great video editor to make what appear to be fairly polished, short-form videos synced to music. With TikTok’s Sound Sync feature, for example, the app can automatically find music that synchronizes with your video clips, if you don’t want to take full control of the editing experience.

On Reels, there’s more manual editing involved in terms of locating the right music and matching it up with your edits — which you have to do yourself, instead of leaving it up to the tech to do for you.

Image Credits: Instagram

Despite being a shameless attempt at being a TikTok clone, Reels lacks other TikTok features, like duets or its “Family Pairing” parental controls. It also makes it difficult to figure out how to share videos more privately. Reels can be posted to Stories, where they disappear, or they can appear on your profile in their own tab — which is a confusing design choice. Plus, the integration of Reels in the Instagram app contributes to app bloat. TikTok is an entire social network, but Reels is trying to squeeze that broader creative experience into a much smaller box alongside so many other features, like Stories, Shopping, Live Video, IGTV and more standard photo and video publishing. It feels like too much.

That said, Reels has managed to onboard a number of high-profile users. Today, it’s touting top Reels from creators like Billy Porter, Blair Imani, Doug the Pug, Prince William and Kate and Eitan Bernath as examples of its creative content.

Even though TikTok’s fate is still a big question mark in the U.S., it’s not clear, at this point, if Instagram will be poised to absorb the TikTok audience in the event of a ban.

Instagram says the option to create 30-second Reels is rolling out today, while the new trimming and editing features are live now. The Timer extension will also roll out in the next few days.

The features will be available in the 50 countries worldwide where Reels is available and elsewhere, as Reels expands to new markets.

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TikTok Walmart

With TikTok deal, Walmart could gain ‘a front row seat to the next generation of consumers’ – CNBC

TikTok logo displayed on a phone screen is seen with Walmart logo in the background in this illustration photo taken on September 21, 2020.

Jakub Porzycki | NurPhoto | Getty Images

Brick-and-mortar giant Walmart may seem like an odd match for TikTok, an algorithm-driven social platform known for hosting memes and viral dance challenges. But a closer look at Walmart’s e-commerce and digital media moves shows that TikTok could help it blend the in-store and online shopping experience, while giving it an edge with young Americans.

Walmart said Saturday that it has tenatively agreed to take a 7.5% stake of a newly created company based in the U.S. called TikTok Global. Walmart CEO Doug McMillon would get a seat on the five-person board of the new entity. Oracle would become TikTok’s cloud provider and a minority investor with a 12.5% stake.

The deal puts TikTok Global under significant U.S. ownership, but TikTok’s Beijing-based parent company, ByteDance, will still have some say in the newly formed company. ByteDance’s CEO and founder Zhang Yiming will have a seat on TikTok Global’s board. ByteDance investors’ shares will transfer over and become TikTok Global shares. 

If approved, the deal would make official Walmart’s relationship with the app, which it already uses as a market research tool. One example is its recently released hot holiday toy list. To help discover what might be popular this holiday season, its buyers turned to TikTok for inspiration.

The app is wildly popular in the U.S., with a steep growth trajectory and strong fan following — especially among teens and twenty-somethings. More than 100 million Americans are monthly active users, the company said in late August. That grew by nearly 800% since Jan. 2018, when the application was used by about 11 million Americans. And it’s used frequently by its fans: More than 50 million people in the U.S. use it every day, the company said.

Walmart, by comparison, has an estimated 1.5 million to 2 million daily purchasers in the U.S., according to a recent research note by Credit Suisse.

A play for Gen Z

Industry watchers say the ties with TikTok could help the big-box retailer sharpen its approach to targeted ads, turn user data into business strategies and establish a relationship with a younger audience.

“For legacy brands, like a Walmart, being able to effectively introduce themselves is very important,” said Jason Dorsey, president of the Center for Generational Kinetics, who studies Gen Z and millennials. “There’s rarely moments where they can engage in such an intensely valued platform and really have a front row seat to the next generation of consumers. That’s what this could potentially give them.”

The deal is not yet done, however, and could get tripped up by government regulators and politicians in the U.S. or China. President Donald Trump said Saturday that he approved the companies’ plans, which could avert the app’s ban in the U.S. However, it is unclear if Chinese officials will greenlight the agreement.

Walmart declined to comment on how it plans to use TikTok, beyond what it said in late August when it confirmed it was seeking a stake and on Saturday when it announced a tentative partnership with Oracle. The retailer originally teamed up with Microsoft on a bid and was competing with Oracle.

In a company statement on Saturday, Walmart said it is still finalizing commercial agreements, but plans to provide “e-commerce, fulfillment, payments and other omnichannel services to TikTok Global.” It said the partnership will benefit the U.S. with more than 25,000 jobs and “exciting, innovative products for people to enjoy around the world.”

“TikTok has delighted hundreds of millions of users and creators around the world, and we are looking forward to creating an even more exciting experience for that community,” the statement said. “This partnership will provide Walmart with an important way for us to expand our reach and serve omnichannel customers as well as grow our third-party marketplace, fulfillment and advertising businesses.”

Seth Sigman, an analyst for Credit Suisse, said in a research note that the move could help Walmart reach consumers under age 44, a demographic where it has lagged. It could gain new appeal for vendors, too, and that could expand its assortment of brands.

Even with a minority stake in TikTok, he likened its significance to the largest deals in Walmart’s history: The $3.3 billion acquisition of online delivery start-up Jet.com, which set the retailer on a path for e-commerce growth, and its $16 billion acquisition of the majority of Indian start-up Flipkart, which broke it into a new marketplace and provided insights that it could use in the U.S.

Livestreams of shopping events

To get an idea of what Walmart might see in the short-form video app, look at Douyin, the Chinese version of TikTok. 

Like many social media platforms in China, Douyin has merged shopping and entertainment. Audiences tune into Douyin livestreams hosted by influencers, where they show off everything from lipstick to smartphones and direct consumers to buy them from Taobao, the e-commerce site owned by Alibaba

Should the deal go through, Walmart could use its minority stake to vie to become the e-commerce backend for TikTok Global’s business. For example, that would mean if an influencer promotes a new L’Oreal product via livestream, the associated link would direct them to buy it on Walmart.com. 

Livestreamed shopping events haven’t taken off in the U.S. yet, but global retailers, including Walmart, understand the sales potential that can be gleaned from these interactions. “There’s a race to build the preferred livestream platform in the U.S.,” said Jordan Berke, founder of Tomorrow Retail Consulting, who led Walmart’s e-commerce activities in China for nearly a decade. 

Walmart has experimented with livestreaming through its partnership with Chinese e-commerce giant JD.com. In 2016, Walmart’s McMillon promoted diapers in a livestream broadcast from the company’s first store in China. The stream was “a huge hit,” drawing more than 200,000 viewers at one point, Berke said. 

Walmart’s relationship with TikTok comes with risks, however, Dorsey said. It could subject Walmart to additional government oversight. It could link Walmart’s brand to TikTok’s actions, such as a potential data breach or a controversial action. And it could face backlash if TikTok’s content or its approach to advertising seems to lean to the right or left politically.

Some of TikTok’s teenage users, for example, took credit for lower-than-expected attendance at Trump’s campaign rally in Tulsa, Oklahoma in June, after they encouraged others to register for tickets and not show. Facebook has faced vocal criticism from politicians and boycotts from users over how the social media platform has been used to spread conspiracy theories or run political ads with false information.

He said Walmart will also have to be tactful in how it uses TikTok’s data. He said members of Gen Z, which range between the ages of 6 and 25, are more willing than any other generation to trade privacy for a better online experience. Even so, he added, there are limits.

“There’s a balance in finding the non-creepy level of engagement that says ‘Oh, it’s highly personalized, but it’s not ‘Big Brother,” he said. 

Dorsey, however, said Walmart’s embrace of the social media platform that skews heavily towards younger users is an excellent brand fit. He said the retailer’s emphasis on value and low prices will likely to resonate with Gen Z, a generation influenced by growing up during the Great Recession and sensing the economic anxiety of family members during those years. Gen Z tends to be “much more pragmatic with their money,” seeking out coupons, shopping at discounters and heading to thrift stores.

“Walmart is really putting themselves in the right place with the right generation that’s already predisposed to wanting to get a discount,” he said.

TikTok already helps guide some of Walmart’s decisions about how to stock its shelves. Brad Bedwell, Walmart’s merchandising director of preschool toys and omni merchandising, said its buyers consulted the app for trends as it helped choose top-rated toys for this holiday season. The retailer orders a higher volume of toys that make the list.

Bedwell said Walmart tries to tap into excitement around certain toys after teens and content creators discuss them or show them off on TikTok and other social media. This year that includes a high-definition video camera kit that allows kids to pick animated green screen backgrounds and do on-screen editing and a Sensory FX ASMR Mega Bar, which picks up on the trend of recording interesting sounds from around the house and sharing them on TikTok.

“It’s actually interesting to see how much those social media platforms drive the toy business, and then we try to leverage that to really connect them to how they can shop and buy toys,” he said.

Walmart may not be associated with flashy tech giants like Amazon and Facebook in the U.S., but the company has made several recent changes to its leadership and strategy that telegraph its plans to build a bigger, global e-commerce presence. Its most recent step was the launch of its subscription shopping service, Walmart+.

McMillon has been “studying digital ecosystems for five years,” while Walmart U.S. CEO John Furner previously led Walmart China’s marketing and merchandising operations and was based in Shenzhen, a major e-commerce hub for companies like Amazon.

China’s consumer shopping habits and the growth of companies like Alibaba and Tencent could serve as a guide for Walmart, should it deepen its ties with TikTok, Berke said.

“Walmart has been aware of the potential to create a digital ecosystem for some time — and aware of the fact that no one in the U.S. is doing it well,” Berke said. “So the moment there appeared to be an M&A opportunity with TikTok, it made perfect sense.”

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Chance TikTok

TikTok deal still has a chance but WeChat ‘dead’ in the U.S., says senior administration official – CNBC

Despite a Commerce Department announcement of a ban on transactions, a deal that would allow TikTok to remain operating in the U.S. could still happen, a senior Trump administration official told CNBC on Friday.

However, the official said WeChat, the social messaging app owned by Chinese tech giant Tencent, is “dead in the United States.”

Earlier Friday, the Commerce Department announced it was banning U.S. business transactions involving the TikTok and WeChat. Beginning Sunday, American companies will no longer be able to distribute WeChat and TikTok, taking away their availability in U.S. app store libraries.  

WeChat will be able to continue operating for people who have it installed on their devices, according to department officials who spoke with reporters on the condition of anonymity. But issues may arise because WeChat uses services run by U.S. firms to deliver data in the app. 

More stringent restrictions on TikTok, which is owned by Beijing-based ByteDance, in the U.S. are set to go into effect Nov. 12, based on the Commerce moves Friday. The actions are the latest developments in weeks of uncertainty stemming from President Donald Trump’s claims that the Chinese-owned apps present national security risks to American users. 

It is still possible a deal involving Oracle and Walmart to take stakes in TikTok can happen. Oracle said earlier in the week it had a deal in place with TikTok, but Trump said days later he was not ready to sign off on the proposal to make the California-based cloud company a technology partner with the social media app. Trump indicated he wanted a larger portion of the entity to be owned by U.S. partners.

Negotiations for a TikTok deal may persist through the weekend, as “a lot of major pieces” need to be resolved, including ownership structure and questions over TikTok’s software. However, the official said there is a chance for a transaction to be finalized before the Commerce Department’s latest restrictions go into effect. 

There is no appetite in the Trump administration for a separate deal involving WeChat, which is a vital app for people in the U.S. to communicate with friends and family in China. 

In a statement Friday, a Tencent spokesperson said it “has always incorporated the highest standards of user privacy and data security” and called the Commerce Department’s restrictions “unfortunate.”

“But given our desire to provide ongoing services to our users in the U.S. — for whom WeChat is an important communication tool — we will continue to discuss with the government and other stakeholders in the U.S. ways to achieve a long-term solution,” the spokesperson said.

—CNBC’s Steve Kovach contributed to this article.

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relying TikTok

TikTok relying on Trump to back off original demand to sell U.S. business and approve Oracle deal – CNBC

ByteDance Ltd.’s TikTok website is displayed on a smartphone in an arranged photograph.

Andrew Harrer | Bloomberg | Getty Images

Of the many questions still revolving around the fate of TikTok, the biggest one may be if the Trump administration will approve a restructuring plan that keeps China-based ByteDance in control, both financially and operationally, in the U.S.

If you go by his words, President Donald Trump has already ruled this option out. 

“I set a date of around Sept. 15 at which point it’s going to be out of business in the United States,” Trump said in an Aug. 3 news conference. “But if somebody — whether it’s Microsoft or somebody else buys it, that’ll be interesting. … So it’ll close down on Sept. 15 unless Microsoft or somebody else is able to buy it and work out a deal, an appropriate deal, so that the Treasury of the United States gets a lot of money.”

Yet, according to people familiar with the matter, the proposal that ByteDance and Oracle have sent to the U.S. government would keep TikTok together under ByteDance’s operational control. Oracle’s role will be as a “trusted technology partner,” storing and securing the data within U.S. premises. TikTok has also said it’s planning to disclose its algorithm to third parties. 

ByteDance is having discussions with both Oracle and Walmart for stakes in the U.S. business, according to people familiar with the matter, but the sale will not be for 100% of U.S. assets. That’s a departure from the deal that was nearly completed several weeks ago at a value of $20 billion to $30 billion. That transaction fell apart at the 11th hour after China pushed back, saying it would need to approve a deal that involves exporting artificial intelligence technology used by TikTok.

ByteDance has submitted a proposal that avoids selling the U.S. assets or all of TikTok — which Trump said was necessary to avoid a ban — because of conversations with the Committee on Foreign Investment in the U.S. and Treasury officials, according to people familiar with the matter. ByteDance believes its proposal with Oracle addresses CFIUS concerns based on precedent and the nature of the U.S. government’s concerns with data sharing, one of the people said. CFIUS is the authority in the U.S. on foreign investments.

The White House declined to comment. TikTok declined to comment, and Oracle did not respond to a request for comment.

It’s still unclear if the Trump administration will accept the ByteDance deal proposal. Treasury Secretary Steve Mnuchin told CNBC on Monday that the U.S. government plans to review the deal this week.

“I will just say from our standpoint, we’ll need to make sure that the code is, one, secure, Americans’ data is secure, that the phones are secure and we’ll be looking to have discussions with Oracle over the next few days with our technical teams,” Mnuchin said on “Squawk Box.”

Kevin Mayer’s plight

If Trump does abandon his previous stance, allowing the application to keep running in the U.S. without a full sale, former TikTok CEO Kevin Mayer will serve as an unfortunate casualty of Trump’s hyperbole.

Mayer had planned to announce his resignation from TikTok in conjunction with a deal announcement, according to people familiar with the matter. But when news leaked to the Financial Times that he planned to step down when a sale was announced — which was imminent at the time — he preempted the deal announcement and said he was stepping down immediately.

Mayer’s reasoning for quitting was that he had signed up to run a global company with U.S. operations, the sources said. The deal on the table called for either Oracle or Microsoft to acquire and run TikTok in the U.S. Mayer didn’t want to run a U.S.-only company as a division of either Microsoft or Oracle, and he didn’t want to be CEO of TikTok without the U.S. (Mayer lives in Los Angeles.)

“I understand that the role that I signed up for — including running TikTok globally — will look very different as a result of the U.S. administration’s action to push for a sell off of the U.S. business,” Mayer wrote in a letter to employees when he resigned.

It’s possible now that TikTok will remain a global company under ByteDance control, meaning Mayer would have had no reason to step down. 

There’s further irony for Mayer: He was part of a team that was instrumental in bringing Oracle to the table as a competitive bidder against Microsoft, which first entered talks to acquire the TikTok U.S. assets in July, according to people familiar with the matter. 

The U.S. government became interested in a potential ban of TikTok after India shut down the application in late June. After ByteDance started talks with Microsoft to take over U.S. assets to avoid a ban, Mayer held talks with Safra Catz, chief executive of Oracle, about a potential deal, the people said. Catz is on the Walt Disney board of directors. Mayer spent more than 20 years at Disney and departed the company for the TikTok CEO job in May. 

Oracle emerged as ByteDance’s partner of choice given the company’s close ties to the Trump administration and willingness to accept a deal where it didn’t buy 100% of the assets, two of the people said. 

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TikTok interim CEO: We already have ‘synergies’ with Walmart in e-commerce – CNBC

Though many saw Walmart as an unusual potential buyer for TikTok, the social media app’s interim CEO Vanessa Pappas said the two companies already have a common interest.

“For us, we’ve been really focused recently on rolling out some e-commerce features. We’ve been providing that for our creator community as another way for them to earn a livelihood,” Pappas said in an interview on CNBC’s “Squawk Box” Friday. “I think there’s a lot of different synergies there.”

TikTok began testing new social commerce features last year by allowing some users to add links to their profiles and videos. Levi’s was among the first retail brands to use TikTok’s new “Shop Now” feature to direct users to merchandise. The company partnered with influencers to spread their message and reported high engagement and traffic to its website in early tests as of April, according to TechCrunch

TikTok is under pressure to sell to an American company before Sept. 20 when an executive order banning U.S. entities from transactions with the app would go into effect. The Trump administration has raised national security concerns with TikTok due to its Chinese parent company, ByteDance. Members of both parties in Congress have shared fears over the potential for ByteDance to be compelled by the Chinese Communist Party to share American user data.

TikTok has repeatedly disputed that it would share data with Chinese officials, saying TikTok is not offered in China and data for the app is not stored in the country.

Microsoft was the first to emerge as a potential buyer for TikTok as pressure mounted. Though it has had a mixed record on consumer offerings, Microsoft would be able to offer TikTok a strong cloud infrastructure at a well-resourced company. Oracle, another cloud provider, has also emerged as a potential buyer. On Thursday, CNBC reported that Walmart was teaming up with Microsoft on its bid.

Pappas said she’s not directly involved in deal talks but saw strengths in both Microsoft and Oracle as technology providers.

“I think if you look at the various players and the partners that we’re hearing from, I think they’re amazing tech companies,” she said. “Oracle has its strengths in terms of being a leading data infrastructure company and focused on security, Microsoft as well, great security and privacy platform as well as everything they’re doing with cloud.”

Pappas took the helm of TikTok after former CEO Kevin Mayer announced his resignation in a letter leaked to the Financial Times this week. Mayer, a former Disney executive who was thought to be in contention for that CEO job before it was filled by Bob Chapek, said he had been looking forward to running a global company. That the actions of the U.S. government seemed to have changed the role he signed up for. 

A deal to buy TikTok’s U.S., Canadian, Australian and New Zealand operations could be announced as soon as next week, sources told CNBC. The deal is likely to be valued at $20 billion to $30 billion, according to the sources.

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WATCH: TikTok is growing rapidly, even as it fights a U.S. government ban

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Kevin TikTok

TikTok CEO Kevin Mayer Resigns Amid Trump Administration’s Growing Pressure On App – NPR

Former Disney executive Kevin Mayer in 2015. On Wednesday, Mayer announced he was resigning suddenly from TikTok as the app’s chief executive amid growing pressure in Washington for the app to sell off its U.S. assets.

Damian Dovarganes/AP


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Damian Dovarganes/AP

Former Disney executive Kevin Mayer in 2015. On Wednesday, Mayer announced he was resigning suddenly from TikTok as the app’s chief executive amid growing pressure in Washington for the app to sell off its U.S. assets.

Damian Dovarganes/AP

TikTok CEO Kevin Mayer is stepping down three months after taking the job at the hugely popular short-form video app.

Mayer’s surprise resignation comes as the Trump administration escalates its campaign to force TikTok to cut ties with its Chinese ownership.

In a message sent on Wednesday to staff at TikTok, Mayer said as the political environment has “sharply changed,” he has reflected on what kind of corporate restructuring may be coming for the company, concluding that it was best for him to depart.

“I want to be clear that this decision has nothing to do with the company, what I see for our future, or the belief I have in what we are building,” Mayer wrote in his message, which TikTok shared with NPR.

“I understand that the role that I signed up for — including running TikTok globally — will look very different as a result of the US Administration’s action to push for a sell off of the US business,” Mayer said.

Executive Vanessa Pappas will serve as the interim head for TikTok’s global operations.

In May, Mayer left as a top executive at Disney to take on the chief executive role at TikTok. His hiring was among a number of moves the company made to convince Washington that TikTok’s U.S. operations were walled off from its parent company, ByteDance, which is based in Beijing.

At the time, Pappas told NPR that Mayer “brings the right level of global expertise to guide our expansion efforts.”

Now, it will be Pappas who heads TikTok as it navigates political and legal turmoil that poses an existential threat to the app that has been downloaded more than 100 million times by Americans.

President Trump has signed two executive orders aimed at TikTok.

One, signed on Aug. 6, outlaws business transactions between U.S. citizens and ByteDance, a move that the Trump administration says arose out of concern for national security. The order would effectively ban TikTok in the U.S and takes effect 45 days after it’s signed, barring court intervention.

TikTok has filed a federal lawsuit seeking to block the order. The suit challenges the constitutionality of Trump’s order, claiming Trump’s action exceeded his authority and deprived the company of due process.

Beijing has sharply criticized the U.S. for blocking transactions with ByteDance, a decision it has repeatedly characterized as discriminatory.

“China supports relevant companies in taking up legal weapons to safeguard their legitimate rights and interests, and will continue to take all necessary measures to resolutely safeguard the legitimate rights and interests of Chinese companies,” Zhao Lijian, a foreign ministry spokesperson, said earlier this week.

But Beijing has shied away from offering ByteDance the kind of full-throated defense it mounted after the Trump administration sanctioned another Chinese company last year — telecom giant Huawei, which China sees as integral to its technological ambitions.

In a second executive order Trump signed on Aug. 14, TikTok was ordered to sell off all of its U.S. assets to an American-based company within 90 days.

TikTok has 1,500 U.S.-based employees with plans of hiring an additional 10,000 over the next three years.

In his letter, Mayer said a resolution of the company’s status will be announced “very soon,” saying the future of the company is “incredibly bright.”

He said any structural changes underway for TikTok should not significantly affect TikTok employees or users.

While the Trump administration has targeted TikTok because of its ties to China, the company has long maintained that its American app is run independently and that U.S. users’ data is stored outside of China, in Virginia, with backup storage in Singapore.

A class-action lawsuit filed against TikTok has alleged that the app steals data from U.S. minors, including their facial characteristics, and quietly sends the information to servers “under the control of third parties who cooperate with the Chinese government.”

But there is no solid proof that TikTok has ever shared data on Americans with the Chinese Communist Party.

The app does collect data on users, including location, video viewing history and phone contacts. The amount of data harvested is not out of step with what is collected by apps owned by major American technology companies, such as Google, Apple and Facebook, yet TikTok’s parent company being based in China has set off alarms in the White House and among some Democrats in Washington.

In a statement, TikTok said: “We appreciate that the political dynamics of the last few months have significantly changed what the scope of Kevin’s role would be going forward, and fully respect his decision. We thank him for his time at the company and wish him well.”

NPR’s Emily Feng contributed reporting from Beijing.

Editor’s note: TikTok helps fund NPR-produced videos from Planet Money that appear on the social media platform.

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TikTok to launch court action over Donald Trump’s crackdown – The Guardian

TikTok has said it will mount a court challenge to the Trump administrations crackdown on the popular Chinese-owned service, which Washington accuses of being a national security threat.
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TikTok to challenge U.S. order banning transactions with the video app, sources say – CNBC

Nicolas Economou | NurPhoto | Getty Images

TikTok is preparing to mount a legal challenge as early as Monday to President Donald Trump’s executive order prohibiting transactions with the popular short video app and its Chinese parent ByteDance, according to people familiar with the matter.

Trump issued an executive order on Aug. 14 that gave ByteDance 90 days to divest the U.S. operations of TikTok. ByteDance has been making progress in talks with potential acquirers, including Microsoft and Oracle. Some of ByteDance’s U.S. investors could also join the winning bid.

TikTok’s legal challenge pertains to an earlier executive order, which Trump issued on Aug. 6, the sources said. That order directed the Secretary of Commerce to come up with a list of transactions involving ByteDance and its holdings that should be banned after 45 days.

TikTok plans to argue that the Aug. 6 executive order’s reliance on the International Emergency Economic Powers Act deprives it of due process, according to the sources. TikTok will also contest its classification by the White House as a national security threat, the sources added.

It was not immediately clear which court TikTok plans to use to file its lawsuit. The company had previously said it was exploring its legal options, and its employees were also preparing their own lawsuit.

While TikTok is best known for its anodyne videos of people dancing and going viral among teenagers, U.S. officials have expressed concerns that information on users could be passed on to China’s communist government.

The sources requested anonymity ahead of the lawsuit’s filing. ByteDance declined to comment. A White House spokesman declined to comment.

TikTok’s legal challenge would not shield ByteDance from having to divest the app. This is because it does not pertain to the Aug. 14 order on the sale of TikTok, which is not subject to judicial review.

However, the move shows that ByteDance is seeking to deploy all the legal ammunition at its disposal as it tries to prevent the TikTok deal negotiations from turning into a fire sale.

The Trump administration has stepped up its efforts to purge what it deems “untrusted” Chinese apps from U.S. digital networks. Beyond TikTok, Trump has also issued an order that would prohibit transactions with Tencent Holding Ltd’s WeChat.

Trump has said he would support an effort by Microsoft to buy TikTok’s American operations if the U.S. government got a “substantial portion” of the proceeds, but has also said there are other interested potential buyers such as Oracle.

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Trump: TikTok Must Be Sold In 90 Days, Cites ‘Credible Evidence’ Of Security Threat – NPR

President Trump on Friday ordered that ByteDance, the Chinese company that owns TikTok, divest from the U.S. in 90 days.

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President Trump on Friday ordered that ByteDance, the Chinese company that owns TikTok, divest from the U.S. in 90 days.

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President Trump on Friday ordered TikTok’s parent company, ByteDance, to sell its U.S. assets in 90 days, stating American authorities have “credible evidence” that the Chinese tech giant could take action to imperil national security.

Last week, Trump signed a separate executive order that would effectively ban the popular video-sharing app by making any transactions between U.S. citizens and TikTok illegal starting in 45 days from its signing. After last week’s strike against TikTok, a lawyer with the app told NPR that a lawsuit is being prepared to challenge the legality of Trump’s action.

Stewart Baker, the former general counsel at the National Security Agency, said the additional order targeting TikTok will serve as “an assurance” that the administration can pressure an American company to acquire the app, or the app will be banned altogether from the U.S.

If the initial executive order comes under attack by a lawsuit, Baker said the new one will likely be able to withstand a legal challenge.

“The other executive order is untested in the courts. The law there isn’t settled,” Baker said on Friday. “This new order is different because it comes from CFIUS, where there is clear statutory procedures to do what it just did.”

Baker is referring to the Committee on Foreign Investment in the U.S., a group led by the Treasury Department and including top officials such as those from the Justice Department and Homeland Security.

The committee investigates acquisitions involving foreign companies that may pose national security risks. For months, it has been probing ByteDance’s takeover of American lip-syncing app Musical.ly in 2017. The merger led to a new company, TikTok, which has emerged as the first Chinese-owned app to find global success.

“CFIUS conducted an exhaustive review of the case and unanimously recommended this action to the president in order to protect U.S. users from exploitation of their personal data,” said Treasury Secretary Steven Mnuchin said in a statement.

TikTok did not immediately return a request for comment.

The order requires that any data linked to American citizens derived by TikTok or its precursor Musical.ly be destroyed.

For more than a year, White House officials have been scrutinizing possible national security risks of TikTok. The company says it has been downloaded more than 100 million times in the U.S. Most videos feature comedic impersonations, dance routines or lip-syncing. About a third of its users in America are 14 years old or younger, according to a report in the New York Times.

TikTok collects data on U.S. users on par with apps owned by major American technology companies. But privacy lawyers suing TikTok in a class-action lawsuit say personal data, like the faces of users who are children, are being collected without consent. In a new filing on Friday, the privacy attorneys say information about what videos users are watching is allegedly being shared without user consent with Facebook and Google.

The Trump administration worries the troves of data TikTok is harvesting on U.S. citizens can be shared with the Chinese Communist Party.

TikTok has distanced itself from its Beijing owner, saying data on Americans is stored in the U.S. and that it never has received a request for information from authorities in China.

U.S. tech company Microsoft is among a number of American companies in talks to acquire TikTok’s U.S. operations.

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