China's ByteDance buys Musical.ly teen app for United States dollars 800 mln

China's ByteDance buys Musical.ly teen app for United States dollars 800 mln

The negotiations broke down over financial deal terms and "general skittishness" about selling to a company whose revenue numbers and user stats were hard to assess, per the report.

Toutiao aggregates news and videos from hundreds of media outlets and has become one of the world's largest news services over its five years.

Wildly popular in America and around the world, with 200 million-plus users creating and sharing 15-second music videos, Musical.ly was founded in China three years ago by Louis Yang and Alex Zhu, who will both be joining ByteDance.

Now the Beijing-based company, with a valuation said to be in the neighborhood of $20 billion, is making bigger moves to crack into the world of mobile video, media and entertainment in the USA and beyond.

Toutiao's purchase of Flipagram, Musical.ly's primary rival in the self-shot-video-accompanied-by-music market, gives Bytedance dominance in soundtracks to personal videos.

In 2016, it rolled out a live-streaming app called Live.ly.




Since its launch, Musical.ly has expanded its content offerings beyond just social lip-syncing video creation. In February it bought USA video creation app Flipagram.

According to Musical.ly co-founder Alex Zhu, "Bytedance's leading AI technologies and top-notch AI developers can empower us to innovate faster and roll out new user offerings unlike anything users have experienced before". The lab's mission is to develop machine-learning algorithms for personalized content recommendations.

Bytedance, which was recently valued at $20 billion, says that Musical.ly will remain a separate, independent business.

Bytedance, meanwhile, is best known for the Toutiao app, which uses artificial intelligence to create customized news feeds for its users. It added to the push this week by acquiring aggregation platform News Republic from Cheetah Mobile Inc, which is also an investor in Musical.ly, for US$86.6 million.

According to news reports, the deal's value has been estimated between $800 million and $1 billion.

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