If Microsoft were to complete an acquisition of TikTok, it would gain a company with much potential for advertising revenue growth.
But with such a purchase, Microsoft would also take on an entirely new slate of problems.
Microsoft announced on Aug. 2 that it was in talks to purchase TikTok’s business in the U.S., Australia and New Zealand, with a deadline to complete the deal by Sept. 15. The company is currently owned by Chinese tech company ByteDance and has become a target of the Trump Administration and other governments over privacy and security concerns. Trump also signed an executive order last week that would ban U.S. companies from doing business with TikTok, but it’s unclear how that order could affect a potential acquisition by Microsoft.
In the U.S., TikTok has grown to more than 100 million monthly users, many of whom are teens and young adults. Those users tune in to TikTok to see full-screen videos uploaded to the app by others. These videos often feature lip syncing over songs, flashy video editing and eye-catching, augmented-reality visual effects.
To say that TikTok represents a business that is radically different than the enterprise software that Microsoft specializes in would be an understatement.
For Microsoft, TikTok could become an advertising revenue powerhouse, but this potential is not without its own risk. Like other social apps, TikTok is a target for all kinds of problematic content that must be dealt with. This includes basic problems such as spam and scams, but more complicated content could also become headaches for Microsoft.
This could include content such as misinformation, hoaxes, conspiracy theories, violence, prejudice and pornography, said Yuval Ben-Itzhak, CEO of Socialbakers, a social media marketing company.
“Microsoft will need to deal with all of that and will be blamed and criticized when they fail to do so,” Ben-Itzhak said.
Microsoft declined to comment, and TikTok did not respond to a request for comment on this story.
These challenges can be overcome, but they require large investments of capital and technical prowess, two things Microsoft is capable of providing. And already, Microsoft has some experience when it comes to moderating online communities.
In 2016, Microsoft purchased LinkedIn for $26.2 billion, and although the career and professional-centric service does not have the degree of content issues its peers deal with, it is still a social network. Microsoft has also run Xbox Live, the online gaming service, since its launch in 2002. Online gaming and social media are different beasts, but they do share similarities.
“Combating misinformation will need to be a mission critical priority. Microsoft will be new to this as it doesn’t have experience managing a high profile social network at this scale,” said Daniel Elman, an analyst at Nucleus Research. “That said, if any company can acquire or quickly develop the requisite skills and capabilities, it is Microsoft.”
But these are no small challenges, and these types of problems have become major issues for TikTok’s rivals.
Facebook, for example, was accused of not doing enough to circumvent fake news and Russian misinformation ahead of the 2016 U.S. election, and four years later, the company still comes consistently under criticism about whether it is doing enough to prevent that type of content from appearing on its services. In July, hundreds of advertisers boycotted Facebook over its failure to contain the spread of hate speech and misinformation.
Twitter, meanwhile, began to lose key users, such as comedian Leslie Jones, after the company let harassment run rampant on its social network. The company has spent the past couple of years building features to reduce the amount of hateful content users have to deal with in their mentions.
These types of issues have already flared up on TikTok. Far-right activists, white nationalists and neo-Nazis have previously been reported on the app, according to Motherboard and the Huffington Post, which found some users who had already been banned by Facebook and Twitter.
Source Article from https://www.cnbc.com/2020/08/10/microsoft-buying-tiktok-could-lead-to-problems-monitoring-social-media-content.html
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