the times | Saturday August 1 2020 2GM 47
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Jul 3 13 21 29 Jul 2 13 21 29 Jul 3 13 21 29 Jul 3 13 21 29 Jul 3 13 21 29 Jul 3 13 21 29Tom Knowles
Technology Correspondent
Microsoft is in talks to buy TikTok as
President Trump considers whether to
force the app’s Chinese owners to sell
their most prized asset.
Washington is investigating whether
TikTok, a video-sharing app, poses a
risk to American citizens due to its
ownership by the Chinese tech com-
pany Bytedance. All firms in China
must hand over data on their users if
asked to do so by Beijing.
Mr Trump suggested last night that
the US may act against Bytedance as
concerns mount about the company’s
privacy practices.
“We’re looking at TikTok. We may be
banning TikTok. We may be doing
some other things,” Mr Trump said.
A deal by Microsoft to buy a $100 bil-
lion Chinese conglomerate would be a
huge success for the computing firm.
Companies such as Facebook would
probably face competition issues if they
wanted to do the deal, but Microsoft
has a smaller social media presence.
TikTok has two billion users and has
exploded in popularity in the past two
years on both sides of the Atlantic, es-
pecially among teenagers. Social media
companies have been rapidly trying to
create their own versions of the app.
In a sign of the many hurdles Micro-
soft might face in negotiations to buy
the app, however, shares in the comput-
ing giant were flat amid the rumours.
Last month the US government was
reported to be considering placing
Bytedance on an “entity list” that would
The boss of the company that owns
British Airways has warned that the
airline is facing an “unprecedented
crisis” as it revealed plans to raise
€2.75 billion to bolster its finances and
reported a record loss.
IAG slumped to an operating loss of
€4 billion in the first half of this year,
which compares with a profit of €1.1 bil-
lion in the same period last year. Willie
BA owner seeks €2.75bn to survive its ‘worst crisis in history’
Dominic Walsh, Martin Strydom Walsh, the chief executive of IAG who
is stepping down in September, said the
airline industry was facing a crisis far
worse than the 9/11 terrorist attacks and
the financial crash of 2009. “It goes way
beyond anything we’ve ever been faced
with before,” he said.
IAG is the product of the 2011 merger
between BA and Iberia of Spain. It has
subsequently bought other airlines,
including Ireland’s Aer Lingus. Before
the Covid-19 pandemic the group had
about 64,000 staff and was flying 570
aircraft. Last year it flew about 118 mil-
lion passengers.
Mr Walsh said that BA’s £711 million
loss in the second quarter compared
with a loss of £187 million in the fourth
quarter of 2001 and a loss of £309 mil-
lion in the first quarter of 2009.
The IAG boss, 58, warned it will take
until at least 2023 for passenger
demand to recover to last year’s level, a
situation which has resulted in job cutsas it restructures to survive. “The dam-
age can be repaired but the company
has to adopt a new structure if it is to be
viable in the future,” he said.
Asked whether he believed business
class travel would recover, Mr Walsh
said: “ We’ll see a recovery but not to the
same level.” He also said that first class
would become much smaller, which
would partly be achieved by the retire-
ment of the Boeing 747.
Mr Walsh said IAG was cutting capa-city as a direct result of the quarantin-
ing of passengers returning from Spain,
although there had been a big increase
in bookings to Greece. “It is very clear
there is underlying demand that is
being suppressed by quarantine,” he
said. “The idea that healthy people
should be locked up for 14 days simply
because they’ve travelled to Spain
seems ridiculous.”
Passenger numbers in the quarter fell
Continued on page 50, col 4Trump could force Chinese owner to sell app
Microsoft
in talks to
buy TikTok
effectively bar it from doing business
with US companies.
TikTok has made several moves to
display its distance from Beijing’s rule
in recent months, insisting that its data
is only stored on servers in the US and
Singapore and that the app operates
independently.
Microsoft did not comment. A
spokesman for TikTok said: “While we
do not comment on rumours or
speculation, we are confident in the
long-term success of TikTok.”
Bytedance purchased Musical.ly, a
Chinese lip-syncing app popular in the
US, in 2017 for $1 billion and rebranded
it as TikTok, gaining a foothold in west-
ern nations. It thrived despite the trade
dispute between America and China.
Tech giants’ $5trn valuation, pages 48-49ALAMYPound surges 6% on dollar in month
Gurpreet Narwan
Economics CorrespondentSterling has enjoyed its biggest month-
ly rise against the dollar for a decade
after mounting concerns about the
economic outlook for the US.
Fitch, the ratings agency, affirmed its
AAA credit rating for the American
economy but downgraded its outlook
to “negative” last night, pointing to
weakening public finances and the lack
of a credible fiscal consolidation plan.
The dollar has fallen sharply in
recent days amid fears that the US re-
covery is running out of steam as cases
of Covid-19 surge across several states.
The pound gained almost 6 per cent
against the dollar in July, approaching
$1.32 at one point yesterday beforesettling in evening trading at $1.31, up
0.04 per cent for the day and 5.7 per cent
for the month. It was the biggest
monthly rise since 2009, according to
Refinitiv. Many investors have
switched from the dollar into gold, with
analysts at Goldman Sachs even raising
concerns about the dollar’s future as the
world’s reserve currency.
Bank of America Merrill Lynch strat-
egists said the rest of 2020 could still see
weakness for the pound as the period of
August to December historically con-
tains four negative months for sterling.
“The fortunes of the pound will be
driven by the ability of the economy to
rebound from the global pandemic, and
Brexit negotiations, which are effec-
tively stuck in the mud,” they said.
Ten-year gilts sank to a new recordlow yesterday as concerns about virus
infection rates and the global economic
outlook led to falls in equity markets.
Ten-year benchmark gilt yields
dropped almost two basis points to 0.07
per cent, just below the previous all-
time low of 0.074 per cent on March 9,
according to Refinitiv data.
The FTSE 100 closed down 1.5 per
cent after Boris Johnson announced
that plans to ease lockdown further
would be scrapped and warned that
more severe measures could be
reintroduced. The Dow Jones industri-
al average fell 0.4 per cent.
The eurozone shrank at its fastest
pace on record in the second quarter,
with GDP falling by 12.1 per cent across
the bloc. Germany, Spain, France and
Italy are all in recession, as is the US.Spot on A puppy and kitten buying boom in lockdown helped Pets at Home to bright first-half results. The first quarter saw a
13.5 per cent fall in sales but they recovered well, lifting by 12 per cent as pet vaccinations and haircuts for dogs were bookedApple is world’s biggest
Apple became the world’s largest
public company last night after
defying Wall Street fears that Covid-
19 would dent sales. The iPhone
maker overtook Saudi Aramco, the
state oil group, as its shares surged
10 per cent to a record high of
$425.04, valuing the company at
$1.84 trillion. The rally followed
third-quarter earnings which beat
expectations for both profit and
revenues. Apple posted higher sales
across all divisions, including services
— a key focus as sales of some
devices taper off — and accessories
such as Airpod headphones.