Trump’s trade war with China forced ByteDance, the Beijing-based parent company of TikTok, to demand the sale of its North American business to a US company within 90 days or face closure. Trump accused the video app of threatening national security.
Walmart said a deal would allow it to better target a younger demographic, as most of TikTok’s hundreds of millions of users are between the ages of 12 and 24. A deal would also boost its nascent advertising business. Amazon quickly grew its online advertising business to nearly $ 15 billion (£ 11 billion) per year.
“We are confident that a Walmart and Microsoft partnership would both meet the expectations of US TikTok users while meeting the concerns of US government regulators,” Walmart said in a statement.Investors responded enthusiastically to the move with shares in Walmart, which already works with Microsoft using its Azure cloud platform, climbing 6%.
However, Walmart’s previous forays into digital media haven’t always been very successful. Earlier this year, it sold its Netflix Vudu-style streaming service, which it launched ten years ago, to movie ticketing company Fandango for an undisclosed sum.
Microsoft has been in talks for weeks to buy out TikTok’s US, Canada, Australia and New Zealand businesses and has been seen as the frontrunner. Rival bidders for the company include Oracle of Larry Ellison, who has partnered with a group of US investors including General Atlantic and Sequoia Capital.
The political situation TikTok finds itself in has claimed its chief executive, former Disney executive Kevin Mayer, who stepped down just months after joining.
The hiring of Mayer, who oversaw the successful launch of Disney’s global streaming service Disney + but was forgotten to replace CEO Bob Iger, was aimed at solving the problem TikTok needed to become a more focused business. over the United States.