Musk's Twitter purchase

This week the social media landscape changed. Elon Musk completed his purchase of Twitter, after a rather interesting historical timeline around the deal:

• Back in April, he revealed he was the publicly-listed company's largest shareholder. Twitter agreed to appoint him to the board of directors, a few days after which Musk then rejected that idea.
• By mid-April, Musk had made a bid to buy Twitter for USD $54.20 per share, as a hostile takeover. The total cost to Musk was USD $44 billion.
• A month later, Musk was having buyer's remorse, supposedly concerned about fake accounts and bots on the site, making it less valuable than he originally thought.
• In early July, Musk tried to back out of the deal, after which Twitter reacted by suing Musk, arguing that he must complete the deal. Musk counter-sued on the basis of supposed information about widespread problems in the company.
• In September the Twitter shareholders approved the deal to sell to Musk, but if the suit against Musk was successful and he backed out of the deal, he was going to lose about USD $2 billion.
• A few days ago, Musk agreed to go through with the deal, with the deadline imposed by the court looming. As I write this, Musk is now the CEO of Twitter, amongst several other companies (including SpaceX and Tesla).

Musk is the world's richest person - at least on paper - through the value of his shareholdings in his companies - estimated at USD $221 billion as of 2022. But of course, the value of companies is very volatile, and that number can go up and down.

The purchase of Twitter was done on the basis of leveraging his holdings in his companies, and also some third-party financing.

The controversy around this is that Musk is a proponent of “free speech”, which includes being free to say anything, essentially. It's been noted though that while Musk purports to support free speech, he has a pretty thin skin himself, and has resorted to blocking accounts that criticise him.

Of note, from the free speech perspective, is that accounts that were previously permanently banned for violations of Twitter's terms and conditions, are being reinstated. This includes the likes of former US president Trump, and various other odious figures including vaccine misinformation peddlers, racists, and bogus US election fraud promoters.

One of Musk's first acts as CEO of the company was to fire a lot of its staff, including executives (which trigger clauses involving payouts in the hundreds of millions of dollars!) and the content moderation chief. Indeed, it now seems that content moderation is going to be a thing of the past on Twitter, with people able to say what they like. Many accounts immediately took advantage of this by tweeting racist slurs.

The puzzling part of this all is that Twitter as a business is actually a pretty bad investment. In its history, it's only been profitable for two years of operation, and is not currently profitable. It would seem that advertisers are likely to be spooked by this, with them naturally not wanting to have their ads appear beside vile racist and hate speech tweets. And, Musk, as a polarising figure, is likely to further erode that profitability (or, should I say, further worsen the loss-making) in people actively rejecting ads on the network (i.e. by blocking companies ads).

As I write this, many people are wondering what the future of Twitter will be. It seems likely that the social network will deteriorate (further - it certainly has a deservedly bad reputation). While there are alternatives (I'm aware of Mastodon, Tribel, Bluesky social) none of these is a leading contender that people can jump aboard and expect the reach and community they find on Twitter.

I find Twitter useful in my personal and professional capacity. Many are vowing to stay aboard, at least for the time being to be able to challenge misinformation (an unfortunately futile cause, in my opinion).

For the record, I find Elon Musk to be a lot (not just a bit) of a dick. While I own a Tesla, my purchase was for environmental reasons, not endorsement of Musk. But, people are complicated, and I think that, on balance, the world's a better place for his presence.

I guess it's “watch this space” to see how Twitter plays out over the next few months.

Update this morning...

Well that escalated quickly! As of this morning, Elon Musk is now tweeting out awful conspiracy theories about the shocking and shameful hammer attack on the US Speaker of the House's husband Paul Pelosi. I have a feeling that Twitter is going to go downhill very quickly!