At a hearing last week for the big four, Facebook FOUNDER CEO Mark Zuckerberg argued that his company had no monopoly, and Zuckerberg raised a list of competitors, stressing that the fast-rising TikTok would be a threat to Facebook. With 100 million users in the U.S., TikTok is the only app that can compete with the dominant social media platform in the market.
In fact, Google and Facebook are already mimicking some of The TikTok’s features. In June, Google’s YouTube began testing 15-second videos with features similar to TikTok, and Facebook’s Instagram announced in July that its imitation TikTok feature was officially launching to the global market.
Kevin Mayer, the US head of TikTok, responded to the US tech giant’s parody. “Facebook launched the Instagram-bound copycat Reels, but its other parody product, Lasso, quickly failed,” Mayer said in a blog post. Let’s focus on launching a competitive product, rather than maliciously attacking an adversary. “
Mayer, who joined TikTok three months ago, was once seen as the prospect of succeeding Bob Iger, Disney’s former CEO, but is now fighting for tik Tok’s fate.
The U.S. internet market is now dominated by Google, Amazon, Apple and Facebook, and if the Trump administration’s ban on TikTok moves forward, TikTok will have to face the option of splitting up its U.S. business, which is likely to be another technology giant, with Microsoft in the best position to buy it. This will undoubtedly further exacerbate the monopoly of the giants and discourage competition in the US Internet market.
More importantly, Microsoft’s acquisition of TikTok may not require business logic. “If this is a very good deal, it will choose to buy even if it doesn’t work with Microsoft’s business.” An investor told the author. Microsoft’s current market capitalisation is $1.5 trillion, and its acquisition of TikTok is off the card.
The investors believe that as long as the price of assets is cheap enough, then it is a good deal. Comcast’s historic acquisition of NBC Universal, for example, cost only $13.75 billion to buy half of Universal Pictures from General Electric, and two years later, Comcast bought another half for $16.7 billion, valuing Universal Pictures at more than $60 billion today.
TikTok is currently valued at about $50 billion, according to Reuters estimates, and while it’s still a long way from Facebook’s market capitalisation of more than $700 billion, TikTok is starting to monetise its huge user base through advertising.
One of Microsoft’s biggest advantages in buying TikTok is that microsoft is not yet among the four biggest U.S. Internet giants. This is also due to Microsoft’s lack of genes in consumer technology, and TikTok is just enough to make up for Microsoft’s shortcomings in consumer products. Historically, microsoft has not had consumer products such as Xbox and Minecraft, but consumer products have not been its core business.
At the same time, it is hard to say whether Microsoft, which bought TikTok, will join the internet monopoly, at least as netizens have expressed their displeasure at the government’s readiness to call off TikTok. In the United States, many young people are increasingly relying on the TikTok platform, which is not only a cultural force, but also allows people to make money from live streaming and advertising revenue. Users worry that the ban on TikTok will put their fans in the dark over the years they have accumulated.
Last week’s hearing of the big four found that these technology companies already had market dominance, and David Cicilline, chairman of the House Antitrust Subcommittee, said: “The power of technology companies should be partially reduced, and all big technology companies must be heavily regulated.” But the big four reported positive results the next day, pushing tech companies’ share prices soaring, with Apple, Google, Amazon and Facebook adding $200 billion in market capitalisation on Friday and Apple surpassing $1.8 trillion, surpassing Saudi Aramco as the world’s largest by market capitalisation.
Mr. Trump has said he has the power to use emergency economic powers or executive orders to ban TikTok’s operations in the United States, which could face legal hurdles. But Mayer has said: “TikTok won’t go anywhere, it will stay there.” “