Tiktok talks with Microsoft unlikely to end in a deal: SCMP Rpt.

TikTok talks with Microsoft unlikely to end in deal. Yahoo Finance's On The Move panel shares the details.

Video Transcript

JULIE HYMAN: Let's get to this story about TikTok and discuss more. As I mentioned, a report just out of the South China Morning Post moments ago that says Microsoft's talks with TikTok might not end in a deal. But as we are learning, there seem to be a lot of parties that are holding discussions or have held discussions with TikTok, even as, perhaps, TikTok is ramping up its resistance, or ByteDance is ramping up its resistance here to what is going on.

I actually want to go to Rick Newman first on this. Because all of this is being paired with sanctions on 11 US citizens from China, including Senators Ted Cruz and Marco Rubio. So all of this seems to be manifestations, again, of the tensions between the US and China. Rick, what stands out to you?

RICK NEWMAN: There's another thing that I think is actually more important than those sanctions on Ted Cruz, who kind of mocked this idea before, saying he wasn't planning to spend his summer vacation in Beijing anyway. So he'll be fine. The US health secretary, Alex Azar, is in Taiwan. China is rattling some sabers about that, sending some fighter jets across a line with the border with Taiwan. They're indicating they're not at all happy with that visit.

That's an acknowledgment of Taiwan's existence as a stand-alone country. So that is a big deal. But to go back to what you were talking about with TikTok, and the possible acquisition by Microsoft, or Twitter, or somebody else, I'm reading this story in the South China Morning Post as part of the deal making process. Basically, the source that the SCMP is talking to is saying that Microsoft's offer is just too low.

So they're indicating, hey, Microsoft, raise your offer. TikTok, supposedly, is worth around $50 billion. Microsoft's offer, supposedly, is between $10 billion and $30 billion. So somebody involved in the negotiations, I'm guessing on the TikTok side, wants to get that number a lot higher. And I think they're leaking to the press as part of the process.

JULIE HYMAN: Oop, I think we're having a little technical problem with Dan Howley. Dan, are you're there for us? Because I know you wanted to weigh in on this as well.

DAN HOWLEY: Yeah, sorry about that. I took a screenshot for some reason. Yeah, I do think that it's strange now that we're hearing that Microsoft may not be the ultimate winner here, just considering that they really should be pushing to get into this space. We don't know, though, what, as Rick was saying, the politics are behind the scenes. It could be that China is pressuring ByteDance to fight back more against the US, basically, you know, obviously, doing some flexing of muscles and saying, you know, we will not acquiesce to demands that the US purchase part of our company or have a US company purchase a part of our company. Because it's our company.

And I do think that, you know, the news that Twitter is also interested in purchasing the US, Australia, New Zealand, Canada operations of TikTok is interesting. I think it would help them a lot more than it would help Microsoft in terms of overall capabilities, considering that, you know, Twitter just isn't at the level as something like a Facebook, nearly close to that. But I do think that it would help them in the long run.

But Microsoft needs this to catch younger consumers and get them more into the Microsoft brand. So I think, ultimately, it's Microsoft that would need this the most.