In an effort to reinvigorate its advertising business with a huge video offering, Microsoft is considering purchasing the United States-based operations of TikTok from ByteDance.
According to a report that was published on Friday by Reuters, which cited a source that was familiar with the situation, Microsoft is reportedly engaged in exploratory talks as the United States government prepares to force China-based ByteDance to remove its TikTok video app due to concerns regarding information security.
The majority of Microsoft’s annual revenue of $ 143 billion (approximately Rs. 10.71 lakh crores) is produced by the company’s ability to facilitate the success of its programming systems, such as Windows and Office, as well as distributed storage and recording instruments through the use of its Azure service.
This month, the company announced that its survey promotion offerings have increased by 1 percent to $ 7.7 billion (typically Rs.57,696 crore) in the most recent year.
This increase was made possible by the publicity of strengthened organisations, such as its Bing Web Index, the MSN News Administration, and the Business People Organization LinkedIn.
However, if we take into account the fees that this development pays to auxiliary sites and applications, we see that it remains at the same level.
According to estimates provided by eMarketer, a company that does research on the advertising industry, LinkedIn’s annual advertising income in the United States alone is close to $2 billion.
However, Microsoft has also revealed this month that LinkedIn’s gross sales have decreased this year. This is due to the new coronavirus outbreak, which has caused marketers to reduce their expenditure.
Because consumers are spending more time entertaining themselves online – particularly with videos – social media companies, along with Alphabet’s Facebook and YouTube,
have seen an increase in their gross sales throughout the course of the pandemic. Advertisers have benefited the most from this trend. on the spot, observations are made.
Microsoft has struggled to capture the increasingly profitable movies that are circulating on YouTube, Facebook, and most recently TikTok, which opened up its advertising tools to a wide audience this month. This is because Microsoft does not offer an entertainment service that can attract a large audience.
Experts in antitrust believe that the enhanced regulatory control exercised by the United States over the possibly anti-competitive activity of Facebook and YouTube has likely reduced those companies’ capacity to quickly acquire a big rival. On the other hand, Microsoft is subject to fewer limitations.
“Its consumer strategy is still being refined, and an aggressive acquisition (or strategic investment) of TikTok would allow Microsoft to throw its hat into the ring and try to compete with other tech giants in a new growth path,” he explained.
TikTok is a mobile app that allows users to create and share short videos. According to a news release issued by Wedbush on Friday, the monetary expert Dan Ives remarked.
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