Aug 10, 2020 - Economy & Business

Twitter jumps into the fray for TikTok

Money signs in the TikTok font.

Illustration: Sarah Grillo/Axios

Twitter is the latest to join the cast of the ongoing spectacle that is TikTok’s battle to stay open for business in the U.S., per a new report from the Wall Street Journal.

Why it matters: The saga to keep TikTok available to U.S. users is getting more complicated, with the company already in a President Trump-imposed time crunch and juggling a number of options.

Between the lines: Twitter’s interest is a tacit admission that it shouldn’t have failed Vine, a short video app it acquired that’s widely seen as TikTok’s precursor. Twitter shut down the app in early 2017.

  • Like other tech companies, Twitter has acquired a number of startups over the years, at times to gain their products and tech while others to gobble up talented employees.

The state of play: Here’s a look at Twitter’s product-focused acquisitions...

  • Vine: Acquired in 2012, the app for making 7-second looping videos exploded in popularity and created a generation of video stars who made entertaining videos with nothing more than a smartphone. However, as the company failed to figure out how to help these users monetize their popularity, they fled to other services, and Twitter shuttered the app in 2017.
  • We Are Hunted: Twitter quietly acquired the startup in 2012 and repurposed it into a music discovery app it released the following spring. Despite the continued popularity of music artists on Twitter’s main service, the company shut down the separate app in early 2014.
  • Periscope: Acquired in early 2015 before it had even debuted its service, Periscope became Twitter’s answer to live video-streaming app Meerkat, which had exploded in popularity during SXSW. Though the app is still available, it’s not longer as popular and its leadership has moved onto higher-profile jobs within Twitter.
  • TweetDeck: Three years after its founding, Twitter acquired the beloved user dashboard. Today it’s still available, though some power users have been grumpy about various changes over the years.

Yes, but: Twitter is now a 14-year-old public company that’s hopefully learned from its mistakes and TikTok is already a well-formed product that Twitter wouldn’t have to build from near-scratch. (Twitter declined to comment on the reports of talks with TikTok.)

  • On the other hand, it’s also unclear how plausible the transaction would be — Twitter’s own market cap is at about $30 billion, with around $7.8 billion in cash and short-term investments as of June.
  • The price tag for TikTok could be as high as $30 billion, per media reports.

The bottom line: TikTok has until Sept. 15 to broker a deal — per President Trump — so the clock is ticking.

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