Report: Microsoft in talks to buy TikTok’s US business from China’s ByteDance

President Trump has plans to order China’s ByteDance, the owner of hit social video app TikTok, to divest from the company, according to new reporting from Bloomberg. The app is increasingly a target of U.S. security concerns over its Chinese ownership.

After the initial news, reports bubbled up that Microsoft is in talks to buy the Chinese social network, which has a massive footprint in the U.S. and beyond. TikTok itself is not available in China and Chinese users instead use Douyin, a similar ByteDance-owned app specific to the country.

While little is known about what such a sale could mean or if the president would really play any role, the event would send huge waves through the tech world. TikTok is one of the only meaningful outside competitors for U.S.-based social networks like YouTube and Facebook.

It’s also not clear if the sale would somehow spin out the company’s U.S. business or if TikTok’s broad international operations would remain intact.

TikTok knows it’s in trouble in the U.S. At a time when even American tech companies are under fire from regulators, the company desperately needs to alleviate government concerns about its Chinese ownership. TikTok made a big strategic move in that direction this May, hiring Disney executive Kevin Mayer on as CEO of TikTok and COO of ByteDance.

Disney streaming exec Kevin Mayer becomes TikTok’s new CEO

It would certainly be strange timing were an American tech giant to purchase TikTok: On Wednesday, a Congressional committee held a high-profile hearing scrutinizing tech’s biggest mergers and acquisitions. The White House declined to comment on the report when contacted by TechCrunch.

Although its big tech peers Apple, Google, Facebook and Amazon were subject to four-plus hours of Congressional scrutiny Wednesday, Microsoft was not asked to attend. Unlike those companies, Microsoft has grappled with antitrust action by the U.S. government before. Microsoft’s primary focus on enterprise rather than consumer business likely also steered regulators away, though the TikTok deal could invite new attention unless it has some kind of special blessing from the federal government.

TikTok has come under increased government scrutiny recently, with the president expressing interest in banning the app outright in the U.S. This month, Joe Biden’s campaign asked its staffers to delete the app from both work and personal devices.

Some U.S. companies have also banned their employees from using the app over concerns about its Chinese ownership.

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Apple’s veteran marketing chief Phil Schiller moves to smaller role inside company

After more than three decades climbing Apple’s ranks, marketing chief Phil Schiller is taking a step back at the company, being replaced by a long-time product marketing leader inside Apple.

Schiller is taking on a new role as an Apple Fellow, where he will continue to lead the App Store and the company’s events, a press release details. Schiller has been with Apple since 1987, serving on the executive team for more than two decades, and has been a frequent presence onstage at Apple events. Schiller will continue to report directly to CEO Tim Cook in his new role.

Replacing Schiller and taking over the bulk of his responsibilities is Greg Joswiak, an Apple product marketing veteran who has become a more public face for the company in recent years at events and in media presentations. Joswiak’s promotion to senior vice president of Worldwide Marketing comes after nearly 20 years at Apple.

This appears to be Schiller moving to a largely advisory role, with Apple employing some of its own marketing flourishes on the transition. Schiller’s maintenance of App Store messaging is interesting, especially as the company continues to be at the forefront of conversations around anti-competitive behavior among American tech companies. The App Store has been criticized for its revenue share model on digital services and CEO Tim Cook recently Zoom-testified in front of the House Antitrust Committee alongside other Big Tech CEO’s where the bulk of critiques levied at him by government officials seemed to focus on his handling of the App Store.

“Phil has helped make Apple the company it is today and his contributions are broad, vast, and run deep. In this new role he will continue to provide the incredible thought partnership, and guidance that have defined his decades at Apple,” said Cook in a statement. “Joz’s many years of leadership in the Product Marketing organization make him perfectly suited to this new role and will ensure a seamless transition at a moment when the team is engaged in such important and exciting work. I’m thrilled that the whole executive team will benefit from his collaboration, ideas, and energy.”

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Google-Fitbit deal to be scrutinized in Europe over data competition concerns

In a set-back for Google’s plan to acquire health wearable company Fitbit, the European Commission has announced it’s opening an investigation to dig into a range of competition concerns being attached to the proposal from multiple quarters.

This means the deal is on ice for a period of time that could last until early December.

The Commission said it has 90 working days to take a decision on the acquisition — so until December 9, 2020.

Commenting on opening an “in-depth investigation” in a statement, Commission EVP Margrethe Vestager — who heads up both competition policy and digital strategy for the bloc — said: “The use of wearable devices by European consumers is expected to grow significantly in the coming years. This will go hand in hand with an exponential growth of data generated through these devices. This data provides key insights about the life and the health situation of the users of these devices.Our investigation aims to ensure that control by Google over data collected through wearable devices as a result of the transaction does not distort competition.”

Google has responded to the EU brake on its ambitions with a blog post in which its devices & services chief seeks to defend the deal, arguing it will spur innovation and lead to increased competition.

“This deal is about devices, not data,” Google VP Rick Osterloh further claims.

The tech giant announced its desire to slip into Fitbit’s data-sets back in November, when it announced a plan to shell out $2.1BN in an all-cash deal to pick up the wearable maker.

Fast forward a few months and CEO Sundar Pichai is being taken to task by lawmakers on home turf for stuff like ‘helping destroy anonymity on the Internet‘. Last year’s already rowdy antitrust drum beat around big tech has become a full on rock festival so the mood music around tech acquisitions might finally be shifting.

Since news of Google’s plan to grab Fitbit dropped concerns about the deal have been raised all over Europe — with consumer groups, privacy regulators and competition and tech policy wonks all sounding the alarm at the prospect of letting the adtech giant gobble a device maker and help itself to a bunch of sensitive consumer health data in the process.

Digital privacy rights group, Privacy International — one of the not-for-profits that’s been urging regulators not to rubberstamp the deal — argues the acquisition would not only squeeze competition in the nascent digital health market, and also for wearables, but also reduce “what little pressure there currently is on Google to compete in relation to privacy options available to consumers (both existing and future Fitbit users), leading to even less competition on privacy standards and thereby enabling the further degradation of consumers’ privacy protections”, as it puts it.

So much noise is being made that Google has already played the ‘we promise not to…’ card that’s a favorite of data-mining tech giants. (Typically followed, a few years later, with a ‘we got ya sucker’ joker — as they go ahead and do the thing they totally said they wouldn’t.)

To wit: From the get-go Fitbit has claimed users’ “health and wellness data will not be used for Google ads”. Just like WhatsApp said nothing would change when Facebook bought them. (Er.)

Last month Reuters revisited the concession, in an “exclusive” report that cited “people familiar with the matter” who apparently told it the deal could be waved through if Google pledged not to use Fitbit data for ads.

It’s not clear where the leak underpinning its news report came from but Reuters also ran with a quote from a Google spokeswoman — who further claimed: “Throughout this process we have been clear about our commitment not to use Fitbit health and wellness data for Google ads and our responsibility to provide people with choice and control with their data.”

In the event, Google’s headline-grabbing promises to behave itself with Fitbit data have not prevented EU regulators from wading in for a closer look at competition concerns — which is exactly as it should be.

In truth, given the level of concern now being raised about tech giants’ market power and adtech giant Google specifically grabbing a treasure trove of consumer health data, a comprehensive probe is the very least regulators should be doing.

If digital policy history has shown anything over the past decade+ (and where data is concerned) it’s that the devil is always in the fine print detail. Moreover the fast pace of digital markets can mean a competitive threat may only be a micro pivot away from materializing. Theories of harm clearly need updating to take account of data-mining technosocial platform giants. And the Commission knows that — which is why it’s consulting on giving itself more powers to tackling tipping in digital markets. But it also needs to flex and exercise the powers it currently has. Such as opening a proper investigation — rather than gaily waving tech giant deals through.

Antitrust may now be flavor of the month where tech giants are concerned — with US lawmakers all but declaring war on digital ‘robber barons’ at last month’s big subcommittee showdown in Congress. But it’s also worth noting that EU competition regulators — for all their heavily publicized talk of properly regulating the digital sphere — have yet to block a single digital tech merger.

It remains to be seen whether that record will change come December.

“The Commission is concerned that the proposed transaction would further entrench Google’s market position in the online advertising markets by increasing the already vast amount of data that Google could use for personalisation of the ads it serves and displays,” it writes in a press release today.

Following a preliminary assessment process of the deal, EU regulators said they have concerns about [emphasis theirs]:

• “the impact of the transaction on the supply of online search and display advertising services (the sale of advertising space on, respectively, the result page of an internet search engine or other internet pages)”
• and on “the supply of ‘ad tech’ services (analytics and digital tools used to facilitate the programmatic sale and purchase of digital advertising)”

“By acquiring Fitbit, Google would acquire (i) the database maintained by Fitbit about its users’ health and fitness; and (ii) the technology to develop a database similar to Fitbit’s one,” the Commission further notes.

“The data collected via wrist-worn wearable devices appears, at this stage of the Commission’s review of the transaction, to be an important advantage in the online advertising markets. By increasing the data advantage of Google in the personalisation of the ads it serves via its search engine and displays on other internet pages, it would be more difficult for rivals to match Google’s online advertising services. Thus, the transaction would raise barriers to entry and expansion for Google’s competitors for these services, to the ultimate detriment of advertisers and publishers that would face higher prices and have less choice.”

The Commission views Google as dominant in the supply of online search advertising services in almost all EEA (European Economic Area) countries; as well as holding “a strong market position” in the supply of online advertising display services in a large number of EEA countries (especially off-social network display ads), and “a strong market position” in the supply of adtech services in the EEA.

All of which will inform its considerations as it looks at whether Google will gain an unfair competitive advantage by assimilating Fitbit data. (Vestager has also issued a number of antitrust enforcements against the tech giant in recent years, against Android, AdSense and Google Shopping.)

The regulator has also said it will further look at:

• the “effects of the combination of Fitbit’s and Google’s databases and capabilities in the digital healthcare sector, which is still at a nascent stage in Europe”
• “whether Google would have the ability and incentive to degrade the interoperability of rivals’ wearables with Google’s Android operating system for smartphones once it owns Fitbit”

The tech giant has already offered EU regulators one specific concession in the hopes of getting the Fitbit buy green lit — with the Commission noting that it submitted commitments aimed at addressing concerns last month.

Google suggested creating a data silo to hold data collected via Fitbit’s wearable devices — and where it said it would be kept separate from any other dataset within Google (including claiming it would be restricted for ad purposes). However the Commission expresses scepticism about Google’s offer, writing that it “considers that the data silo commitment proposed by Google is insufficient to clearly dismiss the serious doubts identified at this stage as to the effects of the transaction”.

“Among others, this is because the data silo remedy did not cover all the data that Google would access as a result of the transaction and would be valuable for advertising purposes,” it added.

Google makes reference to this data silo in its blog post, claiming: “We’ve been clear from the beginning that we will not use Fitbit health and wellness data for Google ads. We recently offered to make a legally binding commitment to the European Commission regarding our use of Fitbit data. As we do with all our products, we will give Fitbit users the choice to review, move or delete their data. And we’ll continue to support wide connectivity and interoperability across our and other companies’ products.”

“We appreciate the opportunity to work with the European Commission on an approach that addresses consumers’ expectations of their wearable devices. We’re confident that by working closely with Fitbit’s team of experts, and bringing together our experience in AI, software and hardware, we can build compelling devices for people around the world,” it adds.

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Apple’s 27-inch iMac gets a processing and graphics boost

Apple sold a lot of Macs last quarter — a record, in fact, for Q3, jumping a full 21%, year over year. Given the state of the world, with most office workers moving to a remote setup, there’s little surprise the company’s desktop and laptops moved at such an impressive clip. For that reason alone, there’s probably no better time to offer a substantial refresh to the company’s perennial favorite all-in-one.

This morning, Apple took the wraps off the latest version of its 27-inch iMac. The changes are, notably, almost exclusively under the hood, but there are a number of key updates as it eyes its long-time bread and butter creative pro clients that it previously courted with the iMac Pro and Mac Pro.

Top-level changes here include the addition of the 10th gen Comet Lake processors that Intel revealed back in April. The six- and eight-core versions of the chips will come as standard configurations, upgradable all the way up to a 10-core i9, which starts to push into the low-end of iMac Pro territory. Per Apple’s numbers, there’s up to a 65% CPU performance increase on-board, particularly noticeable on creative pro apps like Logic and Final Cut Pro.

Graphics, naturally, are getting a boost, as well, at up to 55% faster than previous models, courtesy of the AMD Radeon Pro 5000 series — similar to what’s currently found on the 16-inch version of the MacBook Pro. Meanwhile, 16GB RAM is now standard (up from the base 8GB). That’s configurable all the way up to a hart 128GB of DDR4. SSD storage is finally standard across all iMacs, as well. Here the base is 256GB, configurable up to 8TB. The system also now sports the company’s proprietary T2 security chip, as well as an optional 10GB Ethernet connection.

Apple is building its own processors for future Macs

The display is essentially the same as the previous model, though it now features Apple’s True Tone technology for a more natural color balance based on ambient light in the room. There’s also an option for the nano-texture technology found on Apple’s Pro Display XDR, which promises to reduce glare by better scattering light — a nice upgrade for video editors, especially those now working from home with less than ideal lighting situations. Speaking of remote work, the webcam and mic system have been upgraded. The camera is 1080p, coupled with a similar microphone system as the one found in the 16-inch MacBook, feature two in the system’s “chin” and one in the back.

Contrary to all of the rumors, there’s no redesign here. While it seems entirely plausible — even likely — that a major one is on the way, you’ll have to wait for that. Ditto for the upcoming in-house ARM-based chips. Apple, of course, previously announced that the transition process would take two years to complete — and that there were still Intel Macs in the pipeline. It remains to be seen, however, if the 27-inch iMac will be the last of its kind of that front.

Apple has also noted that it will continue to support Intel Macs for “years to come,” though it’s easy to imagine plenty of folks simply holding off on an upgrade, unless their needs are more dire. And there are probably a number of people in the latter camp, as well, as the reality of working from home doesn’t appear to be ending any time soon (not, for instance, Google’s recent decision to push things back to next July).

The 27-inch still starts at $1,799 and is available starting today. The iMac Pro, meanwhile, now features a 10-core processor (up from 8) as the default configuration, at the same price of $4,999, while the 21.5-inch line (which offer SSDs across the board as per the above) starts at $1,099.

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Huawei overtook Samsung in global smartphone shipments for Q2

Things haven’t exactly been smooth sailing for Huawei in recent years. The company’s rapid trajectory has been disrupted by on-going battles with the U.S. government that have, among other things, blocked its access to Google apps and services. But a new report from Canalys paints a reasonably rosy picture as the hardware giant overtook Samsung to snag the top spot in global smartphone shipments for the second quarter of 2020.

The news is a milestone for a number of reasons, not the least of which is the fact that this is first time in nine years that neither Apple nor Samsung has been at the top of Canalys’ charts. Huawei’s figures were almost exclusively boosted by sales in its native China, which currently comprises more than 70% of its total figure.

Image Credits: Canalys

It’s important to note here, however, the fact that the company took the top spot by essentially shrinking at a less rapid rate than Samsung. Huawei’s overall figures are down 5% year-over-year. But that figure pales in comparison to Samsung’s 30% drop. The two Goliaths are currently at 55.8 million and 53.7 million, respectively.

Things were bad for the smartphone industry prior to COVID-19, but the pandemic certainly hasn’t helped overall, as people are less inclined toward shelling out hundreds to north of $1,000 for inessential upgrades. And, indeed, Huawei’s numbers dropped by 27% outside of China, but the overall slide was dampened by an 8% growth in China. Samsung, meanwhile, currently controls less than 1% of the Chinese market.

As for what this all means for the future, it seems that it may be difficult for Huawei to maintain its top spot. “Its major channel partners in key regions, such as Europe, are increasingly wary of ranging Huawei devices, taking on fewer models, and bringing in new brands to reduce risk” Canalys’ Mo Jia said of the report. “Strength in China alone will not be enough to sustain Huawei at the top once the global economy starts to recover.”

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This Week in Apps: A guide to the US antitrust case against Apple, Microsoft in talks to buy TikTok

Welcome back to This Week in Apps, the TechCrunch series* that recaps the latest OS news, the applications they support and the money that flows through it all.

The app industry is as hot as ever, with a record 204 billion downloads and $120 billion in consumer spending in 2019. People are now spending three hours and 40 minutes per day using apps, rivaling TV. Apps aren’t just a way to pass idle hours — they’re a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus.

In this series, we help you keep up with the latest news from the world of apps, delivered on a weekly basis.

* This Week in Apps was previously available only to Extra Crunch subscribers. We’re now making these reports available to all TechCrunch readers.  

This week, we’re focused on rounding up the news from the U.S. antitrust investigation into Apple, as it pertains to apps, the App Store and developers.

Let’s dive in.

Apps and the Antitrust Hearings

Image Credits: TechCrunch

Developers’ concern over Apple’s alleged anti-competitive behavior with regard to how it runs the App Store was one of the many topics that came up during this week’s antitrust hearings. Apple CEO Tim Cook defended the company’s App Store commission structure and treatment of developers in his sworn testimony before the House Antitrust Subcommittee.

But the documents the committee had collected indicate that there were times, in fact, when developers had not all been treated equally, nor did they all have the same terms. Though it’s not surprising, or even unusual, to hear that Apple had carved out special deals for larger companies, the company has continued to insist the App Store is an even playing field for all developers, both large and small. That’s not the case, the documents reveal, as larger companies got deals allowing them to pay less in commission or had access to faster app reviews and dedicated personnel for their needs.

In addition, the documents detail how Apple’s control of the App Store allows it to unilaterally make decisions about app pauses and removals. This impacts large companies, like Spotify, as well as small developers, like those detailed in these emails:

Documents from the US antitrust investigation into Apple by TechCrunch on Scribd

Here are key sections that pertain to Apple & the App Store:

• Apple Cut a Special Deal with Amazon, pp. 34-51; 67-69: Though Apple claims an even playing field for developers, its rules didn’t apply to larger companies. As part of an extensive deal with Amazon over its Prime Video app and Apple device sales on Amazon.com, Amazon agreed to remove “tens of thousands” of unauthorized (not necessarily counterfeit) sellers of Apple products, to give Apple control over its experience on the retail site, among other things. Apple let Amazon pay a 15% commission for in-app sign-ups on Prime Video subscriptions, instead of the 30% apps have to pay during their first year.
• Apple Cut a Special Deal with Baidu, pp. 52-54: Apple also negotiated with Baidu to make it the default search engine in China, and as part of that agreement, offered it access to an “App Review Fast Track,” where Baidu would be allowed to send Apple a beta app for review to speed up the approval process. Apple also assigned two key contacts to work with Baidu. Again, not surprising that a big company got special treatment, but the party line is that all developers are treated equally. Access to faster app reviews is not something accessible to all developers, under certain conditions, or even publicly documented.
• Apple Considered a 40% Commission, pp. 107-109: Apple in 2011 debated raising its commission to 40%. “I think we may be leaving money on the table if we just asked for about 30% of the first year of sub,” one exec said. Tim Cook, in the hearing, said Apple wouldn’t raise commissions because it competed for developer interest, too.
• Requiring Apple’s Apps as the Default, pp. 32-33: Apple, until recently, never allowed iOS users to make a different app from a third-party developer their default app for that task on their device. That means map links open in Apple Maps and Calendar appointments lead to Apple’s Calendar app, and so on. The upcoming iOS 14 release will allow users to change their default browser and email apps, however. The documents indicate Apple was in possession of complaints from users who wanted to be able to personalize their device to their own needs. Today, Apple still has no plans to allow third-party apps to be set as the default for maps, music, voice assistance, messages, reminders, notes and others, which impacts startups and indie developers who make quality products but can’t gain a foothold on iOS/iPadOS.
• Requiring WebKit for all browsers, pp. 55-56: Apple emails discussed Opera’s 2010 plans to submit a browser it claimed was “up to 6 times faster than Safari,” noting that “it is unlikely that this Opera release is using our webkit, which is required.” Opera, a much smaller company than Apple, was hoping to challenge Apple’s control over the browser experience by taking claims to the press — a tactic often used to demonstrate the limits of developers’ rights to distribute apps on iPhone.
• Banning Apps for Spam, pp. 1-5: Apple banned a developer for spamming the App Store, despite the developer’s claim that he was only creating separate apps because of issues with discoverability on the App Store. The developer, which published a series of maps/guides apps, said people could search for a city by name and find the standalone maps app for that city. But they weren’t being directed to the consolidated app that Apple demanded replace the individual ones, for those same searches. The developer said he would much rather use one single app, as that would be easier to maintain, but had built separate ones because of discoverability issues. Internal Apple emails indicate that Apple stopped accepting the developer’s submissions, forcing them to migrate to a consolidated app.
• App Store Fraud, pp. 6-18: The NYT in 2012 reported on issues around fraudulent charges hitting developers’ apps, which had amounted to millions of dollars for at least one developer over the course of a year. Though fraud is a prevalent problem with digital purchases, the developers’ larger complaint was not that fraud occurred — they didn’t blame Apple for that, necessarily — but that Apple was unresponsive to their requests for help. Apple didn’t reply to emails and didn’t offer a dedicated phone line for complaints, they said. Apple’s internal emails indicated the company didn’t believe there was a real issue with fraud. (“We’ve repeatedly answered this question and haven’t yet identified a case where there is an actual issue,” one exec said.) Apple execs also said the issue had to do with developers who had high levels of refunds and the timing of their refunds. The emails indicated that Apple would “intentionally reply with a standard and rather vague response” about how reporting won’t reconcile due to timing differences and noted that “we do not individually investigate each query.” But the company was aware that some developers had issues. “It is unfortunate as the issue is very small as a percentage of our business and impacts a very small percentage of our developers,” Apple said. Of course, at Apple’s scale, anything that happens to a handful of developers will be a “small percentage” of its business. But for developers, it could be their entire business.
• App Store Search Changes, pg. 21; pg. 28: A November 2015 email indicated that App Store Search changes implemented that month made it harder to find some apps. For example a search for keyword “Twitter” never returned the app “Tweetbot for Twitter,” at all, despite the app’s high ranking and general popularity, evidenced by reviews. Meanwhile, an app that hadn’t been updated since 2008 (Tweeter) would appear in the search results. Phil Schiller forwarded the email to Apple execs with a note “FYI.” (TechCrunch had also reported at the time the changes had impacted the rankings of several iPad apps.) Search issues continued in 2017, as another email indicated that the developer’s app wasn’t being returned for critical App Store keyword search terms in the first 100 results, even for an exact keyword match. While Apple may experience technical problems when it makes changes, developers are left with no resource when those changes effectively “disappear” them from the App Store.
• Apple Removes Parental Control Apps, pp. 70-76, 80-87: Tim Cook was directly questioned about Apple’s removal of screen time apps, and responded that the removals were related to those apps’ use of privacy-invading MDM technology. The documents indicate even Apple was concerned about its move to ban the apps, given their removal directly followed the launch of Apple’s own Screen Time solution. “This is quite incriminating. Is it true?” one exec asked after The NYT covered the story (four months after TechCrunch broke the news!). The apps that were banned didn’t all use MDM, we reported. In addition, Apple didn’t offer a pathway to compliance with regard to apps’ off-brand use of MDM until June 2019. In Congress’ stash of emails from impacted developers, one said they spent an additional $30K trying to fix the problem, but was specifically told “we no longer support Parental Control Apps” even though the App Store still had several listed. A number of consumers also complained about how the apps they relied on had disappeared.
• Apple used App Store to Block Large Companies’ Apps, Too, pp. 77-79, 80-98, 97-98, 102-106: Indie developers weren’t the only ones at the mercy of Apple’s control over the App Store. Verizon (Disclosure: TechCrunch’s parent company’s parent), Spotify, T-Mobile, Amazon and Valve (Steam) also had submitted complaints about their apps not being allowed in or being paused, due to terms violations, and being forced to use Apple’s in-app purchases. Spotify, for example, said it had built a special landing page just for compliance with App Store Rules about not directing users to non-App Store purchase mechanisms. But Apple rejected its app updates for sending an email after a trial period to users directing them to upgrade from Spotify’s website. “Apple claimed that Spotify could not communicate with its own customers, inside its own app, about the existence of its own Premium service — even if there was no link, button, or mention of any offer of any kind,” Spotify legal wrote to Apple legal. “Shortly after our meeting in early July, Apple objected to an out-of-app welcome email to free users, claiming that this email violated the App Store Rules because it mentioned the Premium service,” it said. Apple directly competes with Spotify, which has money to pay expensive lawyers. What are indie developers to do when met with similar situations?

Breaking News

Trump administration to order China-based ByteDance to sell TikTok’s U.S. Operations

Image Credit: Costfoto / Barcroft Media (Photo credit should read Costfoto / Barcroft Media via Getty Images

The Trump administration said on Friday it will sign an order directing ByteDance to divest its ownership of the U.S. app, TikTok, if it wants to continue to operate in the U.S., Bloomberg reported. The app’s associations with China have been under increased scrutiny in the U.S., along with other Chinese tech firms. Most recently, the app has been undergoing a national security review for potential risks. After the initial news, reports bubbled up that Microsoft is in talks to buy the Chinese social network

TikTok has become one of the largest apps in the world and is valued at $50 billion, Reuters reported. The company has been looking for alternative options, including a proposal from some investors, like Sequoia and General Atlantic, to transfer majority control to them. TikTok also fielded acquisition offers from other companies and investment firms, the report had said.

In the meantime, TikTok has recently promised to open its algorithm and fund U.S. creators. It also made another key U.S. hire, with Sandie Hawkins, former VP and head of Americas for Adobe’s Advertising Cloud, now GM of global business solutions for both TikTok and its parent ByteDance.

Hoping to capitalize on the chaos, Triller sued TikTok over patent infringement.

Other Headlines

Image credit: Carl Court/Getty Images

• U.S. Travel App Installs Reached 60% of Pre-COVID Levels in June — Sensor Tower reports on trend in travel app installs hinting at recovery. Vacation rental apps Airbnb and VRBO were bright spots.
• Telegram hits out at Apple’s App Store ‘tax’ in latest EU antitrust complaint — Apple’s antitrust woes aren’t limited to the U.S., TC reports. The messaging app maker says Apple has to allow apps to be downloaded outside the App Store, noting that Apple’s 30% commission leads to higher prices for app users.
• Quibi Patent Suit Moves Forward — Variety reported a judge ruled this week that startup Eko’s patent infringement lawsuit against short-form video app Quibi could move forward. The judge, however, dismissed 3 of 9 claims the suit alleged, but left the heart of the suit — that Quibi used trade secrets to build its app and infringes on Eko’s existing patent.
• Tinder Hires Ex-CBS Interactive Boss Jim Lanzone as CEO — The WSJ reported this week Tinder hired Lanzone as CEO, succeeding current Tinder CEO Elie Seidman. The new exec will report to Match Group CEO Shar Dubey, and has the challenge of guiding the company’s flagship app through a pandemic.
• Roblox jumps to over 150M monthly users, will pay out $250M to developers in 2020 — The gaming platform now has more than 150 million MAUs, up from the 115 million it announced in February before the U.S.’s shelter-in-place orders went into effect. The company also said its developer community is on pace to earn more than $250 million in 2020, up from the $110 million they earned last year.
• Facebook Offers Money to Reel In TikTok Creators — The WSJ reported Facebook’s strategy to counter TikTok was to pay creators to use its Instagram platform instead. The potential payments for some would be in the hundreds of thousands of dollars, the report noted.
• Top Mobile Apps See Declines in User Engagement — TC reported on recent data from App Annie, which found that mobile users now have 93 apps on their phone as of the end of 2019, up from 85 apps at the end of 2015. They also now use around 41 apps per month, up from 35 in 2015. Worldwide, daily time spent in apps has grown to 3.1 hours per day in 2019, up from 2.1 hours per day in 2015. But with that growth has also come increased diversity among the top apps, the report found. That means top apps now make up a smaller proportion of consumers’ total time spent in apps, compared with five years ago.
• Amazon revamps its Alexa app to focus on first-party features, more personalization — TC reported on Amazon’s revamp of its Alexa app. The new app aims to offer a more personalized experience, particularly on users’ home screens, and offers more instructions on how and when consumers can use the digital assistant. Notably, the app has moved its third-party skill suggestions off the main screen.
• India bans 47 apps cloning restricted Chinese services — TC reported that India, which last month blocked 59 apps developed by Chinese firms on the grounds that they pose a threat to the nation’s security, has banned an additional 47 apps that were facilitating access to previously banned services, like TikTok.

Funding and M&A

• YC alum Paragon snags $2.5 million seed for low-code app integration platform. Investors include Y Combinator, Village Global, Global Founders Capital, Soma Capital and FundersClub.
• Revolut extends Series D round to $580 million with $80 million in new funding. The fintech startup had raised $500 million led by TCV at a $5.5 billion valuation in February.
• Huuuge Games acquired games studio Double Star, Apptopia reported, citing Gamesindustry.biz. The studio’s top title is the game Bow Land, which has generated $3.7k via in-app purchases this year, the firm said.
• Toppr raises $46 million to scale its online learning platform in India. Toppr is one of the largest online learning startups in India and offers apps for iOS, Android and web.
• Delightree raises $3 million to help franchise business owners simplify their operations. The startup aims to move much of what currently happens through pen-and-paper over to smartphones.

Downloads

Google One 

Image Credits: Google

Google introduced a mobile utility for its cloud storage service Google One. The app will automatically back up your phone’s contents, like photos, videos, contacts and calendar events, using the 15 GB of free storage that comes with a Google account.

Facetune Video

Image Credits: TechCrunch

Lightricks, the startup behind a suite of photo and video editing apps — including most notably, selfie editor Facetune 2 — is taking its retouching capabilities to video. Today, the company is launching Facetune Video, a selfie video editing app, that allows users to retouch and edit their selfie and portrait videos using a set of AI-powered tools.

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Apple’s partners and Samsung apply for India’s $6.6 billion local smartphone production program

South Korean giant Samsung, Apple’s contract manufacturing partners Foxconn, Wistron and Pegatron, and Indian smartphone vendors Micromax and Lava among others have applied for India’s $6.6 billion incentive program aimed at boosting the local smartphone manufacturing, New Delhi said on Saturday.

The scheme, called Production-Linked Incentive Scheme, will offer a range of incentives to companies including a 6% financial incentive on additional sales of goods produced locally over five years, with 2019-2020 set as the base year, India’s IT Minister Ravi Shankar Prasad said in a press conference.

22 companies have applied for the incentive program — that also includes manufacturing of electronics components — and have agreed to export 60% of their locally produced units outside of India, said Prasad. He said the companies estimate they will produce smartphones and components worth $153 billion during the five-year duration.

The Production-Linked Incentive Scheme is aimed at turning India into a global hub of high-quality manufacturing of smartphones and support Prime Minister Narendra Modi’s push to make the country self-reliant, said Prasad.

A total of 22 companies have filed their application under the PLI Scheme. These companies will produce mobile phones and components worth Rs 11.5 lakh crore in the coming 5 years out of which products worth Rs 7 lakh crore will be exported. pic.twitter.com/3yUky3HkOC

— Ravi Shankar Prasad (@rsprasad) August 1, 2020

As part of their applications, the companies have also agreed to offer direct and indirect employment to roughly 1.2 million Indians, the Indian minister said.

The interest of Samsung and Apple, two companies that account for more than 50% of the global smartphone sales revenue, in India is a testament of the opportunities they see in the world’s second largest internet market, said Prasad. “Apple and Samsung, India welcomes you with attractive policies. Now expand your presence in the country,” he said.

Missing from the list of companies that the Indian minister revealed today are Chinese smartphone makers Oppo, Vivo, OnePlus, and Realme that have not applied for the incentive program.

The Indian government did not prevent companies from any country from participating to the program, Prasad insisted in a call with reporters Saturday noon. Chinese smartphone vendors command roughly 80% of the Indian handset market, according to research firm Canalys.

“We are optimistic and looking forward to building a strong ecosystem across the value chain and integrating with the global value chains, thereby strengthening electronics manufacturing ecosystem in the country,” he said. The deadline for applying to participate in India’s program, which began in April, ended on Friday this week.

The participation of Wistron, Foxconn, and Pegatron is also indicative of Apple’s future plans to produce locally in India. Apple’s contract manufacturing partner, Taiwan-based Wistron, first began assembling older iPhone models in 2017. Last month, Foxconn kickstarted assembly of a small batch of iPhone 11 units. This was the first time any Apple supplier assembled a current-generation iPhone model in the country.

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