Microsoft Or Twitter? Ad Buyers Weigh In On TikTok’s Future

twitter tiktok microsoft

The TikTok saga roils on, with Twitter now in the ring with Microsoft as potential acquirers for the viral social media app.

While Microsoft’s acquisition of TikTok wouldn’t necessarily be about advertising, it could lend technical support and a trusted reputation for TikTok in the United States. Twitter has more advertising synergies with TikTok, but could threaten to ruin the app’s magic if it absorbs its features as a user acquisition play.

Where would TikTok find a better home? AdExchanger asked ad buyers the following question:

How would TikTok ownership by either Microsoft or Twitter impact advertisers differently?

Barry Lowenthal, CEO, The Media Kitchen

“Microsoft has deep pockets, and Satya Nadella is an extraordinary CEO. TikTok will probably need to be managed autonomously but have a safety net, and Microsoft can do that. TikTok would provide Microsoft with a new audience of younger consumers.

“However, Microsoft is not really in the business of social media. Microsoft is not a creative company, and TikTok’s creativity will have to be cherished. Microsoft has not had great experiences managing ad-supported businesses under the old regime.

“Twitter is a social company, but it hasn’t proven to be the most innovative. Twitter doesn’t have as deep pockets as Microsoft, and is likely to face regulatory attention if it continues to wade into the national discourse on free speech.”

Humphrey Ho, Managing Director, NA, Hylink

“Microsoft would likely leave TikTok an independent product, which is a positive. Microsoft has the cloud computing requirements to process the TikTok algorithm, data, video storage and ad serving with the Azure Cloud. And Microsoft can add experience from its advertising team to help TikTok reach revenue goals faster – assuming it treats the acquisition as a revenue play, rather than a user acquisition play. TikTok employees would see their shares graduated into Microsoft stock, potentially attractive to new talent.

“But the culture fit remains a question. And Microsoft has offices and large operations in China, so how that would pass the test of being independent of Chinese influence remains to be seen.

“Twitter would have a more seamless culture fit and complementary product strengths. Users can be pooled, and most influencers likely have a Twitter account. Advertisers that already work with Twitter would get an expanded set of ad units. A deal could also open long-tail advertising on TikTok. Twitter is also censored in China, so a tie-up would pass that test.

“But if Twitter decides to absorb TikTok’s features, it would be detrimental. TikTok captures a younger audience than Twitter, and its users might not want to use Twitter. If Twitter integrates TikTok’s inventory into its platform, it would disrupt TikTok’s product road map.”

From Doug Rozen, Chief Media Officer, 360i

“Any buyer of TikTok will be getting a ready-to-be-mined advertising machine. TikTok is on the verge of a significant ad breakthrough at a time when clients are struggling with traditional outlets, akin to where Snapchat was a few years ago.

“For TikTok, a been-there, seen-that parent can help speed up their scale to what organically would take more time. The only challenge post purchase is will it be left to flourish like Instagram and YouTube or fumble like so many now dead social darlings.”

Shamsul Chowdhury, VP of Paid Social at Jellyfish

“Microsoft has the capital and infrastructure to make TikTok a real contender amongst social platforms in the United States. But Microsoft has struggled to integrate its acquisitions like LinkedIn. While that may not be a con, it could mean that Microsoft doesn’t progress TikTok in a meaningful way, resulting in stagnation and potential demise.

A Twitter acquisition has more cons than benefits. Twitter has been challenged in establishing a legitimate offering in the social space, meaning an acquisition would likely not result in TikTok’s ultimate success in the United States. A Twitter acquisition would make advertisers less optimistic about TikTok’s future, since Twitter is battling its own obstacles and may not be as successful in steadying the ship for TikTok.”

Amanda Martin, VP, Enterprise Partnerships at Goodway Group 

“While it’s early to weigh the pros and cons of either potential acquisition, TikTok being acquired vs. banned provides the most impact for advertisers. TikTok’s rise in popularity amongst a younger audience has the potential to be extremely impactful for advertisers, and that opportunity being blocked would be the larger con.

In the short-term, I don’t foresee ownership impacting advertisers differently. But the viability of the product’s long-term success is not guaranteed, and both acquisitions present hurtles.”

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