It is going to be a great deal if Microsoft is able to acquire the business of TikTok from the company ‘ByteDance’ that looks over the operation of TikTok in the US, in terms of the Ads business of Microsoft they will get a platform with lots of videos content. On Friday, a few reports have emerged that suggest Microsoft is in the initial stage to seal the TikTok deal, as the US government is forcing the ByteDance “China-based company” to seize their operations in the US due to security reasons.
The annual revenue of Microsft is around $143 Billion (Rs 10.71 Lakh Crores approx.) with their license software such as Windows and MS Office and from their cloud storage facility as well as computing tools like Azure.
Microsoft in talks to buy TikTok’s US operations from ByteDance
The advertising business of the company is run through the Bing search engine, LinkedIn Business Social Media Platform, and MSN news service. In last month, Microsoft has revealed its net revenue through ads $7.7 Billion Dollars (Rs 57,696 Crore approx.), it shows a flat year-on-year growth of 1% which doesn’t seem much when you exclude the fees that need to pay to the partner’s website and apps. Will Donald Trump Ban TikTok From Operating In The US?
According to the “eMarketer”, an ad market research company LinkedIn estimated ad revenue for this year was about $2 Billion in the US. But as per Microsoft, the ads revenue has seen a decline this year. Due to the pandemic, advertisers are not spending lots of ads.
However, on the other hand, video content platforms like Alphabet’s Youtube and Facebook both have seen a spike in their revenue. This is pretty obvious, due to pandemic and lockdown, more and more peoples are preferring to stay at home and therefore consuming video content from such platforms more than ever before. This is the reason advertisers are more attracted to these social media platforms.
That’s why Microsoft has struggled when other companies are having a blessing in disguise, With no entertainment platform, they have lacked to grasp on the wider variety of audience. TikTok is the one that can help Microsoft in such a scenario.
With the continuous pressure from US regulations on Facebook due to its anticompetitive behavior and YouTube is currently not able to purchase any big platform, Microsoft doesn’t seem any resistant right now.
Dan Ives, the Wedbush financial analyst said, “Its consumer strategy remains in flux and an aggressive acquisition (or strategic investment) of TikTok would be Microsoft throwing its hat in the ring and trying to compete with other tech giants in a new avenue of growth.”