Netflix approached to acquire TikTok in US, report suggests
Netflix has reportedly been approached to buy the US operations of TikTok, becoming one of a long string of US-based companies linked with the embattled social media app.
Earlier this month, president Donald Trump announced that the app – which has seen a number of security concerns surrounding the data practices of Chinese parent company ByteDance – would be banned from the country. The administration later clarified that this would be avoidable should ByteDance divest its ownership.
Since then, a number of companies including Microsoft and Twitter have emerged as potential suitors and now the Wall Street Journal reports that streaming giant Netflix has been approached to sound out a potential deal.
The US business of TikTok has wildly different valuations, with analysts and investors pricing the division at between $10-50bn.
Netflix, with a market cap of $216bn, would be one of a few companies whose business may benefit from TikTok while also being able to afford it. By contrast, it was reported that Twitter would need external investment to fund a deal.
It would also be an interesting move for Netflix, considering that co-CEO Reed Hastings earlier this year highlighted the Chinese company in his Q2 letter to investors as an entertainment player. He wrote: “TikTok’s growth is astounding, showing the fluidity of internet entertainment.”
While speculation continues to mount over a potential buyer, TikTok earlier this week launched a legal challenge against Trump’s ban on any transactions between US citizens and ByteDance. In its court case, the Chinese firm says that the government breached TikTok’s right to due process and that it was not notified ahead of the executive order. It also says that claims the Chinese government has access to US user data is lacking evidence.
Neither company has commented on the story.