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Comment by enumjorge | Hacker News Reader

I still don’t understand what Microsoft is thinking. Facebook, Google, Twitter, and to some extent Apple have had to deal with content moderation headaches on their respective platforms. Especially when it comes to politics, it seems like un-winnable battle. Do nothing and you’ll get blamed for helping spread hate and propaganda. Do something and you’ll get blamed for violating free speech and censoring conservatives.

As far as I know, Microsoft has so far avoided being on that hot seat. So why, now, get involved in the shit show that is social media? I still don’t understand why Trump has a beef with TikTok specifically, but if the rumors are true that this is payback for the prank they pulled on his first political rally, isn’t this whole thing political in nature? What if TikTok users continue to mess with Trump? I can imagine Trump now set his crosshairs on Microsoft. I don’t understand why you’d willingly put yourself in the middle of a controversy to buy a company that doesn’t exactly align with your current businesses. What am I missing?

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Microsoft tried to build a YouTube competitor (Soapbox). Microsoft tried to build a Facebook competitor (Socl). Microsoft bought Yammer. Microsoft bought LinkedIn. Microsoft did build a Slack competitor that seems to be doing well (Teams), after failing to buy Slack. Microsoft bought and ran a Twitch competitor up until just recently (Mixer). Microsoft still seems to have hopes that its Xbox social features are competing as a Facebook or Twitter competitor for very narrow niche of gaming-related sharing.

Microsoft hasn't been immune to social media fever, it's just been somewhere between unsuccessful and unlucky. (Which maybe makes it "lucky" for not being on that "hot seat" you describe, but certainly not for lack of trying. Parts of Xbox have been and are on that "hot seat", though.) If Microsoft is thinking anything about TikTok, it's probably that it could get a good deal on a strong competitor in an actively highly competitive social media space. (Whether or not that can translate to success or luck, given Microsoft's track record to date is another question entirely.)

I mean they have the money and a stock that's nearly doubled in a year, quadrupled in 5 years. A stock and cash deal for a chance at making the next $100B social network doesn't seem all that bad

I think Microsoft has a lot of products that can be complimentary to and tie into a broad social media product like TikTok. Some thoughts:

* Bing / Ads / AI: Microsoft used to power FB ads after they invested in 2007. GPT-3 has shown that there's a lot that is probably happening within the AI division of these large tech companies. Adding a consumer social media product like TikTok will probably help them test models + gather information to train their models.

* LinkedIn / GitHub: Microsoft has two social websites targeted toward the professional crowd. Adding a consumer product may allow them a higher % of coverage of social activity that starts to rival FB and even surpass Google.

* Xbox / Minecraft: Consumer brands that have been reasonably successful under Microsoft. Some good tie-ins with TikTok could help boost all three brands.

You come close to mentioning it but don’t: GPT-3 was trained on Microsoft compute resources (according to the paper).

The goal is data collection. Even if they do absolutely nothing with TikTok, they are still getting a massive amount of data on TikTok users through the purchase.

We have seen this with Skype and LinkedIn. They are acquiring an exisitng user base and the data that goes with it. Microsoft was even on of the early investors in Facebook at a point when Facebook had no proven business plan, but had many users.

It is arguable Microsoft has been trying to transform into a data collection company. Aside from these acquisitions, we see them aggressively pushing their Windows users to accept telemetry, automatic upgrades and a view of MS software as a subscription service.

Some would argue that Skype was a controversial company when Microsoft acquired it. One could argue that MS solved a problem for those who were uncomfortable with the growth of Skype. After the acquisition, Skype was no longer controversial (except perhaps to a small number of technically savvy users who disliked the architectural changes MS made).

Perhaps the same could be said of TikTok. For some, TikTok is a controversial company. If MS acquires it, will TikTok continue to be controversial? Let's wait and see.

When Microsoft aquires a company it does not necessarily mean that whatever the company has been doing will continue. For example, the company behind the T-Mobile Sidekick, Danger, was perhaps the first cloud-syncing smartphone and its founder went on to create Android at Google. Microsoft acquired Danger. It did not then become a MS product. Most people have never even heard of Danger. The OS, which was NetBSD-based, was something MS could not work with. Did we get a next-generation NetBSD-based phone from MS? No, we got s series of successive failures to create a Windows smartphone instead.

Microsoft as a dependable steward of technology created by others is still unproven. Look at Internet Explorer, originally created using the Mosaic code from the U. of Illinois. After so many years of work developing it as their own browser, they now abandon it for Chrome.

Perhaps this is why their acquisition of Github has some people concerned.

Skype was a gift to the TLAs. The same with eBay controlling them so that people could be connected to PayPal accounts.

This is a pretty ridiculous conspiracy theory. Microsoft does not spend 8.5B as a gift to the US government.

I still wear my Danger Developer Days t-shirt from 2007. Those were fun times!

Because "it's a deal. It's a steal. It's sale of the f*ing century!"

You tell me if these below are worth 50B or not: - An exponentially growing company that's already generating 3B profit https://www.cnbc.com/2020/05/27/tiktok-bytedance-profit.html - Taking the 800m deal away from Google Cloud (almost 10% of the Google Cloud annual revenue): https://www.theinformation.com/articles/tiktok-agreed-to-buy... https://www.zdnet.com/article/google-cloud-hits-a-10b-annual... - The knowhow of creating a viral social media in genz. The potential to compete against F and G in ads.

Yes. This deal is amazing. Snapchat and Twitter stock trade between $25-35B these days. To buy them, you’d need to offer a premium. Say close to $40B TikTok for less than double that is an absolute steal. Not that even $100B would be an issue or fair price.

Say Microsoft buys it for $80B. Even if TikTok peters out and Microsoft gets back half that in profits, they’ll benefit in other ways through that time and the remaining loss is the cost of taking a well calculated risk. There’s no downside to this deal at all if it will cost close to the rumored $60B price tag.

To your point of competing in ads. They’ll still be far from FB and Google, but it should solidify them as a strong number 3 alongside LinkedIn, Bing, and their properties. Followed by Amazon before a drop off for Verizon, Twitter, and probably something I’m forgetting. Maybe Iac if including all their property spin offs (assuming they have stakes in them).

A man can dream. This gives a tiny bit more potential for a Google Adsense competitor. Still waiting for FB and/or Microsoft to try it. Yep I remember Yahoo failing. I think Yahoo tried Analytics too. Wouldn’t mind Microsoft Analytics against Google’s (when you need an industry standard analytics to show traffic)

excellent lock stock quote there :)

Do you think, from a large company's point of view, being "on that hot seat" is not worth the potential profit of a successful social platform? From what I can see, these company's have taken very little actual damage from that controversy. The moral complaints do little to their bottom line, and government talks tough but does nothing. Pragmatically, I think it seems like owning one of these platforms has more pros than cons.

> government talks tough but does nothing

... except force sale of successful Chinese companies to allies of Trump.

Sure, but headlines are still going to be "TikTok bans...", or at most "TikTok, which is owned by Microsoft, bans..." I doubt controversy related to TikTok is going to have much spillover on Microsoft. For the average person, Microsoft is still synonymous with Windows, Word, Excel, and maybe they've heard of this new thing called Azure.

Likely a defensive acquisition for Microsoft. Facebook would probably be rejected from the deal for anti-trust reasons so it basically comes down to Google and Amazon that could acquire. So its probably Microsoft denying either of these companies the opportunity to improve their own social network brand while finding a way to pose future competition to Facebook.

Google would go through a long anti trust because of Youtube too, no? Even if they prevail, it would be a long fought battle that makes them a no go.

Amazon is there though yeah.

Maybe we’ll have Salesforce swoop in and try to merge. Like the wanting to buy Twitter :).

There is considerably less politics on TikTok than other platforms.

I'd say that the short video format is unsuitable for politics but twitter exists so quality of argumentation is obviously irrelevant.

Sorry but can we back track and just go to basics. Facebook throws off a tonne of money. Yes, people get angry about the political nature of their content decisions, but at the end of the day these social networks can be enormous revenue streams. MS can pick this one up at a massive discount, and even if they later decide that they don't want to be in that business they can spin it out for a hell of a lot of money because they won't be under the hammer of being banned.

Strategically the fact that Microsoft isn't political is one of the advantages - everyone knows Facebook is the living emobdiment of a psychopath. But trying to convince people that those nerds who sell Office are secretly pushing a political agenda is going to be a tough sell. Microsoft isn't like Google, Apple or Twitter- they're not advertising a political ideology as part of their company image.

I wonder how many really think that about Facebook. I’m sure a lot, but the exaggeration around techie sites sometimes seems like people believe it.

I’ve never had a problem with Facebook any more than Microsoft in the 90s or Google or Amazon for the past decade+.

I find Twitter and Snapchat worse [at times] personally. Jack and Ev screwed over Noah Glass so egregiously. Jack being the worst of it. Then they attempted to white wash over the history. Jack had a made up story of how he came up with Twitter. The rest have lied for so long about other aspects even though Noah is the one that began the initial proper work of Twitter on his laptop. That sort of personal behavior and to never make any sort of amend for it.

I find that to be worse than anything Facebook or Zuckerberg have done. I always find these sort of personal cruel behavior to be the worst. Related examples are the Snapchat founders screwing over the third, Larry Ellison + Steve Jobs screwing over people including not giving stock to many first employees. Jobs doing it in Pixar and Apple.

I'm not saying that Facebook have or haven't done better or worse than other companies in reality. What I'm saying is that their public reputation is atrocious at a level where the average person can understand it. Everyone's seen "The Social Network", people tune in for him testifying to congress (which he did this week, and I'd encourage you to just check out how he comes across visually compared to the others), emails saying he'll destroy other companies if they don't sell, and the Cambridge Analytica scandal.

> “ everyone knows Facebook is the living emobdiment of a psychopath”

The context of this and the rest of your original post made it sound like you believe the statement as well. This comment appears to reinforce that.

Again, I’m not sure how many people care about all the things you listed beyond the current trend to say how evil or bad FB and Zuckerberg are.

The same trend began with Bezos a few years ago when he became the richest person and has continued.

Companies most in people’s lives will naturally have the most attention. So their rich founder CEOs will get the brunt of negativity too.

I don’t think the average person understands it.

Your second paragraph is scary. It essentially says that a private organization should make business decisions that doesn't upset the king. We have entered faux democracy

People cheered that the government was finally getting more involved in tech when the House had the dog and pony show. This is the ultimate result. We already saw Cook kiss the Golden Ring with photo op he did with Trump at “Apple’s manufacturing facility” (that wasn’t really Apple’s). Just to keep the President from punishing Apple with tariffs.

Most observers are convinced this “king” is on his way out. I think the parent was arguing that he’ll still be around just long enough to potentially cause problems for Microsoft.

They were sure he wouldn't have made it this far to begin with.

Any business decision riding hard on political hopes and dreams isn't really a safe investment this decade, no matter which side it's favoring.

As someone who has been close to acquisitions of this size, "not upsetting the king" is always a factor - whoever the president is. At least at the companies I've worked at, it basically falls under public relations/political risk. Even if a deal is really profitable, you might kill it if you think you're going to get the gov't breathing down your throat either for legitimate reasons or just because the company you're acquiring is a good whipping boy for the gov't.

Microsoft already owns a social media: LinkedIn, although it is smaller than the 2 big ones it is still quite large.

Especially when it comes to politics, it seems like un-winnable battle. Do nothing and you’ll get blamed for helping spread hate and propaganda. Do something and you’ll get blamed for violating free speech and censoring conservatives.

These are mostly problems in the media. In the real world, most users love these platforms: https://jakeseliger.com/2018/11/14/is-there-an-actual-facebo....

There's a big gap between the media world and the real world.

And the media has glaringly obvious bias when it comes to all they delude themselves into seeing as "competitors". They'll display past acquisitive grammar on police while murdering all logic to make multileveled impossible and insane demands "Block all crime and piracy without looking at user content at all while paying both the user and content creator!"

I think you are missing the bigger picture here.

Facebook, Google, Twitter all get heat from a very small portion of the population for not moderating their platform enough that is true. What is also true is that as far as I know we have no proof that these accusations have any impact on their bottom line.

Facebook is the big bad social network that was caught playing with its users' feed to see how it would impact their mood. That is straight evil yet I would be willing to bet it never had any significant impact on their ad revenues.

My aunt won't stop being on Facebook because of some controversy, the same way that my younger siblings don't care if you can see some alt-right content in a dark corner of TikTok.

> Facebook is the big bad social network that was caught playing with its users' feed to see how it would impact their mood. That is straight evil yet I would be willing to bet it never had any significant impact on their ad revenues.

How is this different from AB testing?

Yeah maybe my words weren't nuanced enough, I don't have strong feeling regarding that particular event, but it caused outrage yet I'm sure there wasn't any significant impact to the revenue of Facebook.

You said it’s straight evil. Isn’t that having strong feelings and not considering it simply A/B testing?

The study itself was portrayed as evil by most mainstream media that covered it. That's what I meant and my perception of it doesn't matter to the point I was making.

https://www.independent.co.uk/life-style/gadgets-and-tech/fa... "creeped out"

https://www.forbes.com/sites/kashmirhill/2014/06/28/facebook... "disturbed"

https://www.theguardian.com/technology/2014/jun/29/facebook-... "scandalous", "spooky" and "disturbing"

moderation on Tiktok is pretty good

go try to find illegal or nude content on it. you can't!

I suspect that Microsoft wants to buy TikTok as a favor to the US Government. I view this as possibly a repeat of Ebay/Microsoft buying Skype as a favor to the US Government.

If moderating TikTok is too much of a hassle, they'll probably just mismanage it into irrelevancy (having already accomplished their primary objective of satisfying the American government that TikTok isn't a threat to American interests (either commercial or national security.))

I don't understand the negative response to this comment which is just summarizing the US Government's official public statements on the matter. Trump Admin doesn't want Chinese companies dominating US commerce or exfiltrating data, or at least wants to be seen as wanting that.

I understand (and even support) the government not wanting foreign companies exfiltrating data for national security reasons. But why this one specific company? Why only the Chinese government? Why now? Why not address the wider problem and protect all of our data from exfiltration by all foreign companies? Or regulate and monitor companies that do?

I’ve never used TikTok and I’m really not a fan of any social media company but the way this whole situation is being handled feels decidedly un-American and frankly unfair to TikTok/ByteDance.

Because China is a big threat to our future security and economy and there are ongoing and historical issues that have never been addressed? They are a human rights nightmare?

Why do people side with China so easily?

I’m not “siding with China” I’m siding with due process and fair and consistent application of the law. If China is a major threat why isn’t the government forcing Tencent, Alibaba, and Huawei to spin-off and sell their American operations to US companies, too? Tencent has to have just as much data as ByteDance. Probably more. And their relationship with the Chinese government and willingness to assist in Chinese government surveillance is well documented. Better than any rumored evidence against TikTok.

I’m not saying TikTok should be allowed. I’m just wondering why, if Chinese surveillance is such a clear and present danger to our national security, we’re only talking about TikTok.

I’m suspicious of any government action in the name of “national security” and I’m infinitely more suspicious when that action is specifically targeted without any logic or reason that can be articulated beyond “national security”.

And not once have human rights been mentioned with respect to TikTok so we both know that has nothing at all to do with it.

To be perfectly serious: because Donald Trump is mad at Tik Tok because he thinks kids on that platform pranked his rally last month by "buying up all the tickets" and leaving empty seats.

I'm a little terrified that this may be true.

They didn’t buy Skype as a favor to the US government. You would need a truly warped understanding of business to entertain this thought.

"Favor" is the wrong word, but only because that implies a lack of payment. Quoting from https://news.ycombinator.com/item?id=18411779 :

> 2009 - NSA offering 'billions' for Skype eavesdrop solution [1]

> 2011 - Microsoft buys Skype for $8.5 billion. Why, exactly? [2]

> 2012 - Skype replaces P2P supernodes with Linux boxes hosted by Microsoft [3]

> 2013 - Microsoft handed the NSA access to encrypted messages Subhead: Skype worked to enable Prism collection of video calls [4]

> 1. https://www.theregister.com/2009/02/12/nsa_offers_billions_f...

> 2. https://www.wired.com/2011/05/microsoft-buys-skype-2/

> 3. https://arstechnica.com/information-technology/2012/05/skype...

> 4. https://www.theguardian.com/world/2013/jul/11/microsoft-nsa-...

None of that supports the claim that Microsoft bought skype as a favor to the US government. It’s mostly a bunch of silly conjecture. Removal of supernodes does make it easier to intercept, sure, but that doesn’t mean it was the motivation for that change, and it definitely doesn’t mean it was tied to requests by a government.

Now that they have the capability, they would have to comply with court orders, like every other communications company based in the US.

Frankly I think you're naive, unless you're getting hung up on "favor." If you expect me to believe that Microsoft would never cooperate with the American government like this, you'll have to do better than name calling.

If common sense doesn’t convince you otherwise, have fun. Their purchase had absolutely nothing to do with the US government. Business with the US government just does not work the way you seem to think it does.

Indeed, they would not cooperate “like this”, (they’ve been suing them to shield customer data, in fact) but they obviously would comply with US law.

You're absolutely right about the mess MS will face wading into the sludge of social media content. But that aspect of this aside:

Forget about Trump's dislike of TikTok for that prank, and instead think in terms of national security: TikTok was literally copying keystrokes on peoples phones and, presumably, using it for some purpose. It's not far fetched to think it was sent "home" to the parent company, which is obligated to turn data over to the Chinese government.

Making Microsoft in charge of it in the US solves that issue. This obviously introduces the issue of MS's data collection on users, but we already have that issue with TikTok, only with the downside that it may benefit a hostile foreign government.

> I still don’t understand why Trump has a beef with TikTok specifically

Zuckerberg. TikTok is eating Facebook's lunch and Zuckerberg sees Trump as the easiest remedy.

How would Microsoft buying it fix this?

TikTok isn’t eating Facebook’s lunch either. They are co existing as the top tier social media companies.

Trump will likely be seeking other opportunities in a matter of months, and is not a long-term concern. TikTok is a social network, and social networks, for all that they are a pain to run, make money.

Microsoft is not a technology company at its core. You have to look at it as a conglomerate similar to Berkshire Hathaway except MSFT focuses on investing in technology companies. The reason why this works is because their cap cost is one of the lowest and they are able to use its shares to more or less retain talent at a steep discount as a result.

Tencent fits that mold.

Microsoft big purchases outside media ones that have mostly if not completely been divested are aQuantive, Skype, Yammer, Nokia, Mojang, GitHub.

- Many of their big 90s acquisitions like Hotmail and Vision were part of their core products. - Nokia, Danger were for their phone business. - aQuantive was a response to Yahoo, Google buying up advertising properties - Yammer was for their central enterprise moves - Mojang along with a number of other gaming purchases like Rare Obsidian, and backend companies are for their strong gaming division. - GitHub fits in with their Azure and developer focus. - Skype could’ve fit in better and did try and was for their cohesive enterprise and all in one attempts. It fits too.

- LinkedIn is the only one you can really say was a big purchase without the same level of synergy or drop in support to the company.

Microsoft is as far from a conglomerate as you can get.

If you want tech conglomerates, look at Tencent. Their portfolio is absolutely absurd. Even SoftBank outside the vision fund is a tech conglomerate.

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