TikTok Game: Twitter May Be A Better Buyer
- 82newsbulletin
- Sep 21, 2020
- 2 min read
Written by Victtoria Mingyang Ni
TikTok has gained more than 100 million active monthly users. The American market alone represents 10% of TikTok's audience. Twitter and Microsoft are the two potential buyers of TikTok under the current framework.
There are several considerations when it comes to purchasing a company. Usually, factors such as revenue generation, integration with existing products, synchronisation of business models and extension of services will be considered.
Many argue that it makes more sense for Twitter to acquire TikTok:
a. Expanding the reach:
TikTok would be the perfect product to extend Twitter’s reach toward younger audiences, broadening not only its viewer base but the advertisers that want to reach them. It also provides agencies and buyers with a stronger alternative to Facebook. Consequently, it will lead to wider demographics for advertisement delivery.
b. Monetisation:
A surge in Twitter users does not mean a longer term financial solution. Integrating with TikTok will provide a cross-selling powerhouse opportunity.
However, the market capitalisation of Twitter is too small compared to TikTok, especially when Microsoft is also bidding for a share. The deal is only possible if Twitter can gather a group of financiers to provide the money.
Outside of the financial concerns, the TikTok deal also reveals present geopolitical struggles.
The current attitudes toward Chinese technologies and applications reflect each nations’ political orientations toward the Chinese State. The diagram below provides a summary of how different countries have dealt with TikTok.
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