Over recent weeks, we have been charting Microsoft's interest in video social network TikTok. The company has gone as far as confirming that interest, speaking to President Trump about it, and reportedly singing a nonbinding agreement to acquire some of TikTok's operations from Chinese parent company ByteDance.
We have seen some rivals emerge to Microsoft's plans, including Oracle and Twitter. It now seems U.S. retail giant Walmart is also entering the race, but this time as an ally to Microsoft. In fact, the company has confirmed to CNBC it and Microsoft have made a joint bid for TikTok's U.S. operations.
On the surface, the interest in TikTok stems from President Trump seeking to ban the company from the United States. An executive order signed earlier this month stops ByteDance from handling any transactions in the United States. This order will come into effect within 45 days of being signed.
So, TikTok is in a race against time to save itself in the U.S., which has led to the idea of being bought by someone. Microsoft appears to be leading the chase, now alongside Walmart. One of the key questions when Microsoft said it had interest in the platform was… why?
Microsoft has never gone big on social media and TikTok does not fit into current services outside of Xbox.
Now it is becoming clearer and it seems Microsoft and Walmart plan to leverage TikTok in their fight against Amazon. Like all companies in the physical retail sector, Walmart has been hit hard by the emergence and continuing success of Amazon. Unlike many, the company was big enough to fight back both online and in its physical stores.
Still, the impact of Amazon has been felt and Walmart is looking for ways to boost its position. Speaking to Business Insider, the company confirmed the joint bid with Microsoft. Walmart says TikTok would become a part of its Walmart+ service.
“The way TikTok has integrated e-commerce and advertising capabilities in other markets is a clear benefit to creators and users in those markets,” Walmart said in a statement to Business Insider. “We are confident that a Walmart and Microsoft partnership would meet both the expectations of US TikTok users while satisfying the concerns of US government regulators.”
Microsoft and Walmart are existing partners. Microsoft too sees value in impacting Amazon through retail. Redmond is a major competitor with Amazon Web Services with its Azure platform. Both Microsoft and Walmart have a mutual enemy and believe TikTok could help.