Elon Musk Raises More Questions About Twitter’s Approach, Which Could Lead to a Big Shake-Up

If not anything else, Elon Musk turns out decided to shake issues up in his time as Twitter’s high shareholder, and notice what he could make occur, which might set the platform on a route for inner angst and consumer disruption as Twitter’s quite a lot of leader take a look at to in finding tactics to placate the newest member in their board.

But sooner than we get into Elon’s newest suggestions for the platform, it’s value organising the place Twitter is at, and what its present objectives are, to set a transparent working out of the stakes.

Back in 2020, investment company Elliott Management bought a 4% stake in Twitter – value round $1 billion on the time – with the intent of forcing Twitter to oust long-term CEO Jack Dorsey and exchange him with a extra business-focused chief, with a view to maximizing the app’s efficiency.

Elliott’s view used to be that Dorsey, who could also be the CEO of Square, used to be not able to give the corporate the eye it calls for whilst working in each roles, so it purchased up stocks so as to push him out. Eventually, Twitter’s control negotiated a peace deal of varieties with the Elliott crew, which concerned Elliott and Silver Lake Partners both gaining a seat each on Twitter’s board, and noticed Twitter set bold new expansion objectives, which, possibly, additionally held important consequences for Dorsey and Co. if they might now not be met.

Those objectives had been shared publicly in February final yr:

  • 315 million monetizable day by day energetic customers via This autumn 2023 (Twitter these days has 217 mDAU and added 18m in general in 2021)
  • $7.5 billion annual income in 2023 (Twitter made $3.7b in 2020 and $5.1b in 2021)
Twitter analyst day targets

As you’ll be able to see, the ones are some difficult objectives, and it can be that the power positioned at the corporate as a results of Elliott’s push lead to Dorsey’s determination to step down as CEO in November final yr. Dorsey used to be changed via CTO Parag Argrawal within the function, and that would, in some respects, have given the Elliott consortium what it desires, which will have eased the power at the corporate – however then, in a while after his appointment, Agrawal re-affirmed that Twitter would maintain these growth targets in Dorsey’s wake.

So Twitter already has a difficult highway forward of it, particularly on consumer expansion. And into this comes Elon Musk, who purchased up a 9% stake in Twitter past due final week. That’s double the protecting of Elliott Management, and greater than Elliott and Silver Lake blended, giving Musk a important voice within the corporate. Twitter temporarily appointed Musk to its board, amid considerations that he may glance to buy-up much more stocks, and take a controlling passion within the corporate (Musk’s appointment to the board limits him from buying more than 14.9% of the company).

And now, we’re on this new fact, the place Musk’s voice may dangle important sway within the corporate’s long run path.

And he’s wasted no time in making provocative claims and assertions forward of his first AMA with Twitter staff next week.

In a past due evening flurry of tweets on Saturday evening, Musk famous that:

  • Twitter’s hottest accounts, in keeping with follower numbers, are not very active, which brought about the query – ‘is Twitter demise?’

This comes after Musk shared a ballot previous within the week, during which he requested if Twitter customers need an edit button, which greater than 4.4 million people responded to (74% in favour). Twitter then famous that it’s, in truth, running on an edit button, and has been for a while, however Musk’s ballot as soon as once more underlined the general public power that he may put at the corporate, which he too can now use to back-up his perspectives and reviews in Twitter’s board conferences.

Musk’s array of concepts may definitely reason some complications, and making plans restructures inside of Twitter HQ.

On the primary level, that Twitter’s hottest customers aren’t energetic – Twitter’s already running in this, via including in new incentives to get other people to tweet extra steadily, together with Super Follows, tipping, e-newsletter integration, on-profile product shows and extra. Those almost certainly gained’t get the Justin Bieber’s of the sector to be extra energetic, as a result of they’re gained’t essentially be incentivized via those income systems, however they might get extra mid-level influencers extra energetic, which might make Twitter really feel extra ‘alive’ as soon as once more.

Maybe. It’s laborious to say how efficient such things as Super Follows will in fact be, however there’s now not in reality a excellent answer to get extra top profile customers enticing extra steadily. If Musk has any concepts on that, undoubtedly Twitter’s control will likely be prepared to listen them.

On the second one, that Twitter must upload another checkmark for paying customers, this concept has been floated repeatedly, that Twitter may examine customers that turn out their identification, now not with a blue tick, however with one thing else, so as to legitimize their presence. Making this a paid possibility almost certainly isn’t one of the best ways to move (as it would incentivize scammers), however perhaps there may well be a controversy for variable signs in keeping with evidence of identification, which might put extra onus on accounts to verify their main points, thereby lessening the have an effect on of faux accounts and bots who wouldn’t have it.

Which leads to Musk’s final level (I will’t say a lot on the concept that Twitter’s house base must be re-used for any other objective), that there are too many bots and rip-off profiles within the app, which affects the consumer revel in. This is most likely true – in accordance to earlier estimates, round 15% of energetic Twitter profiles are most likely bots, whilst bot accounts have additionally contributed up to 60% of the tweets round politically divisive subjects every now and then.

That’s a important drawback – however on the similar time, would eliminating them be in Twitter’s easiest pursuits, from a metrics point of view?

As famous, Twitter’s taking a look to upload nearly 100m energetic customers within the subsequent yr and a bit. Removing 15% of its energetic consumer base – an identical to round 32m profiles – would obviously have an effect on that technique, making it nearly not possible to achieve.

But perhaps it will be higher for Twitter, total, to assault this extra vigorously? Maybe it will be higher to take away bots totally, despite the fact that it reduces the consumer rely – however alternatively, we don’t know the consequences that Twitter’s control may well be dealing with if it fails to meet those benchmarks.

Could Musk persuade Twitter’s board to exchange path in this, if Twitter had been to fight bot profiles?

That then leads to questions on figuring out and eliminating bots definitively, which might indubitably lead to some false positives, and most likely some relief in engagement, a minimum of within the brief term.

Such an manner may paintings, within the longer-term view, however would Twitter’s different shareholders have the persistence required to re-structure this part?

These are the sorts of questions that Twitter’s going to have to weigh within the Elon Musk generation, and whilst they might smartly lead to systematic enhancements, they might additionally reason some main complications for Twitter’s control within the upcoming quarterly stories.

And then there’s the censorship part, and Musk’s possible affect on Twitter’s stance on moderation and eliminating accounts that ruin the principles.

Musk lately wondered Twitter’s adherence to ‘unfastened speech ideas’ which he famous are elementary to democracy.

Musk used to be additionally a vocal critic of Twitter’s banning of former US President Donald Trump early final yr.

Interestingly, the founding father of Elliott Management, billionaire investor Paul Singer, could also be a “Republican mega-donor”, who, whilst he used to be to start with antagonistic Trump’s insurance policies and manner, ultimately came over to backing the previous chief.

So now you may have a minimum of two parts in Twitter’s board room who, at a look, would seem to again a extra ‘unfastened speech’ manner to moderation on the app.

That may spark giant conflicts, particularly as social platforms now appear to be typically in settlement that quicker motion is needed on probably damaging actions, so as to quash them sooner than they acquire any traction.

Platforms took too long to address QAnon, permitting it to unfold, and infect extra other people by way of their networks. They have now not made the similar mistake on anti-Ukraine propaganda.

Will Musk’s appointment be a step again in this part, and make allowance extra bad speech to take dangle by way of tweet?

Certainly, proper wingers are happy with Musk’s board ascension, and with the pending failure of Trump’s ‘Truth Social’ app, they’ll be prepared to see if Musk can reinstate a few of their previous freedoms, a minimum of in a perceptual sense, inside the app.

No subject what, Twitter definitely seems set for a shake-up – however whether or not the result is in fact a higher revel in, we’ll have to wait and notice.

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