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TikTok Engineers Ordered By ByteDance To Prepare A Shutdown Plan In US: Reuters


08/28/2020


TikTok Engineers Ordered By ByteDance To Prepare A Shutdown Plan In US: Reuters
Engineers of the popular short-video app TikTok were ordered by its owner, the Chinese company ByteDance, to get ready a contingency plan if the company actually decided to completely shut down its operations in the United States even as the Chinese firm still tries to negotiate a divestment deal for the app, claimed a report by the news agency Reuters.
 
The US president Donald Trump had issued an executive order asking ByteDance to sell of TikTok’s US operations to an American company because the Trump administration is concerned that the Chinese company and its app can be a national security threat. The American companies that are in the race to bid for the app include Microsoft Corp and Oracle Corp. the Chinese app claimed that it has about 100 million monthly active users in the US.
 
According to the Reuters report, it is expected that a inner among the bidders will be chosen by  ByteDance as early as this weekend.
 
An executive order issued by Trump on August 6 effectively banned all American companies form transacting with the Chinese company and its app within a period of 45 days. TikTok is now reportedly preparing for a possible shut down of its US operations if its sell off was not possible with mid-September even though t he company has also filed a lawsuit in the US challenging the executive order. The report also said that the company expects that any shutdown of its US operations would be temporary in nature. 
 
Both the United States and Chinese governments will have to approve the sale of TikTok. The report also claimed that the preparations for the shutdown of TikTok were being made if one of the two countries – the US or China, does not approve of the deal and for preparing the global operations of the short video sharing app for such a contingency.
 
The engineers of TikTok were ordered to draw up plans for shutting down the app in the United States in a memo that was issued last week by ByteDance, the Reuters report claimed.
 
In the event of a shutdown, a separate plan for compensation of TikTok’s US employees and vendors is also being made by ByteDance, reported Reuters quoting sources. The uncertainty over its US operations had already prompted TikTok to implement a hiring freeze in the US for most open positions. Only about 5 per cent of the total planned recruitments hass been done, said the Reuters report.
 
The report also claimed that the shutdown preparations by ByteDance are simply a back-up plan and the company is aggressively working to get a deal through for the divestment of TikTok to keep in running in the US.
 
None of the sources were named in the Reuters report because news of the shutdown preparations were confidential.
 
“We are confident that we will reach a resolution that ensures TikTok is here for the long run for the millions of Americans who come to the platform for entertainment, self-expression, and connection,” a TikTok spokesman said in a statement. “As any responsible company would do, we are simultaneously developing plans to try to ensure that our U.S. employees continue to get paid in any outcome.”
 
(Source:www.reuters.com)


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