As financial journalists across the US bang their heads against the wall trying to parse what President Trump meant when he said TikTok and Microsoft - or whoever ends up buying TikTok - would need to pay "key money" to the US Treasury, CNBC is reporting that Microsoft and ByteDance are starting to talk valuation for the deal.
To be sure, President Trump hasn't said anything more about his extemporaneous rant about TikTok paying the US Treasury for the privilege of continuing to operate in the US (a remarkably socialist-sounding suggestion from a Republican president). But Microsoft has implied that simply paying taxes on the deal could satisfy this requirement, and we suspect all the speculation on CNBC and elsewhere is merely kayfabe.
But in bigger news, Instagram on Wednesday launched its new "Reels" features, something that critics and observers like Kara Swisher claimed was essentially a rip-off of TikTok.
Earlier this week, the People's Daily accused the US government of trying to "steal" TikTok from ByteDance. Now, it looks like ByteDance is about to get "Zucked".
Here's more on Instagram's new product from Buzzfeed.
On Wednesday, Instagram launched possibly its most anticipated US update since Stories or the dog filter: its TikTok competitor, Reels.
And, I gotta say, Reels sure looks a lot like TikTok.
Of course, this all couldn't come at a better time for Instagram or its parent company, Facebook. President Donald Trump has begun waging an all-out war against TikTok, which is owned by a Chinese company called ByteDance.
Last weekend, Trump threatened to ban the app from the US over what he called concerns with what the company is doing with American data.
In the middle of the drama, Instagram had the serendipitous luck (although, I put nothing past Mark Zuckerberg) of dropping what is essentially a TikTok clone. (Apropos of nothing, emails released cited in a Congressional hearing last week revealed that Facebook bought Instagram in the first place in order to "neutralize" a competitor.")
It really is an uncannily similar product. I got access to Reels on Monday ahead of the US public launch, and immediately was kind of amazed at how TikTok-y Reels felt.
With the tap of a button, you can scroll through Reels almost exactly like you scroll through your ForYou page, falling into the same kind of mindless, addictive scroll-hole that has made TikTok a favorite pandemic time-waster of millions.
The early access was only open to select publishers, influencers, and journalists so there weren't as many of the random teens, hilarious videos, and funny animals that you would see on TikTok, and the pool of videos was much smaller. However, a lot of the culture seems to have made the jump, with a lot of the same memes, songs, and sounds I normally see on my ForYou page popping up on Reels.
If nothing else, the launch will make it easier for TikTokers to simply upload all their "greatest hits" to Instagram.
Instagram's cloning of TikTok via reels will undoubtedly remind many of how Instagram's "stories" ripped off the most popular features from Snapchat, making Evan Spiegel regret his decision to turn down Zuck's buyout offer all those years ago.
In other TikTok news, CNBC's David Faber, who boasted about his thorough sourcing on air earlier, reported Wednesday that Microsoft and ByteDance have started talking TikTok valuation as deal negotiations advance. Apparently, both companies remain eager to strike a deal, despite allegations of "theft" levied by the People's Daily, and lingering confusion (playing out on CNBC in real-time) about President Trump's demands for "key money" that - according to Trump and nobody else - must be paid before CFIUS will approve the deal. Both companies are also working with CFIUS and each other to try and work out a plan for severing TikTok from ByteDance and transferring it to Microsoft in its entirety (in a way that ensures none of those pesky "backdoors" remain).
In keeping with the deal talks between Microsoft, TikTok and the US government, CNBC's Faber said TikTok and Microsoft are hammering out a plan to separate some 15 million lines of code from ByteDance and transfer all of it to servers based in the US.
As TikTok tries to reassure CFIUS that it isn't some kind of CCP trojan horse, the company announced three new measures on Wednesday that it says will help combat "misinformation" intended to tamper with the 2020 US election. Part of this will involve TikTok updating its policy on misleading content to clearly articulate "what is and isn't allowed on TikTok".
The TikTok teens, who are already bemoaning the loss of their favorite platform by moving en masse back to Instagram, might not like that.