Xinhua News Agency, Beijing, October 29. Elon Musk, the founder of Tesla Motors and SpaceX, completed the acquisition of Twitter and officially took over the American social media giant on the 27th. His first move was to fire three senior executives, including the Chief Executive Officer (CEO) and Chief Financial Officer (CFO).
Since Musk proposed to acquire Twitter in April, the deal has been negotiated and reached an agreement, Musk backtracked, and Twitter sued the court. After six months of twists and turns, the deal has finally come to an end. As for the development prospects of Twitter after changing hands, it is closely related to Musk’s behavior and is difficult to predict.
Twitter changed hands
With the help of multiple financial institutions and individual investors, Musk bought Twitter for $44 billion. Musk posted a video on Twitter on the 26th, showing him walking into Twitter’s headquarters building in San Francisco, California with a smile on his face, carrying a sink, with the text: “let that sink in!” The English literally means ” Put that sink in”, which actually means “clean up well and settle down your thoughts”.
This is September 29, 2017, in Adelaide, Australia, Elon Musk, founder and CEO of SpaceX, gives a keynote speech before the closing ceremony of the 68th International Astronautical Congress. Published by Xinhua News Agency (Photo by Yan Han)
He also changed the personal Twitter account identification information to “Chief Twit”, which means “Twitter head.”
According to US media reports, Musk fired former CEO Parag Agrawal, CFO Ned Siegel and head of legal affairs and policy Vijaya Gard as soon as he entered Twitter. Musk has accused the men of “misleading” himself and investors about “fake accounts.”
Agrawal was Twitter’s chief technology officer and was promoted to CEO last November. Citing people familiar with the matter, Reuters reported that he and Siegel were immediately “sent” out of Twitter’s headquarters building as soon as the deal was completed.
The New York Stock Exchange website previously announced that Twitter shares were suspended from trading on the 28th.
Musk himself has been active on the Twitter platform since 2009, accumulating a large number of “fans”. While promoting companies under the name of Tesla or Space Exploration, many of his remarks have caused controversy and even lawsuits over business disputes, including the storm surrounding the acquisition of Twitter.
Musk began to quietly buy Twitter shares at the beginning of this year. In April, he announced that he would acquire Twitter. After reaching an agreement with Twitter, he decided to terminate the acquisition on July 8, on the grounds that Twitter concealed data about “false accounts” from him. Twitter, which is registered in Delaware, sued Musk on July 12 in the local Court of Chancery, which handles commercial disputes, accusing him of refusing to take over as a contract and causing Twitter to suffer huge losses.
The court ruled on the 6th of this month to suspend the trial of the lawsuit, but Musk must complete the acquisition transaction before 17:00 on the 28th Eastern Time, otherwise the court will restart the trial in November. After meeting the deadline, Musk was able to avoid trial or punishment.
Unpredictable prospects
It is unclear if and when Musk will give himself a formal title or appoint new executives.
Reuters reported that Musk has not disclosed specific information on the future development of Twitter, and his previous words when he conceived the future of Twitter are wild or contradictory. Musk said on the 19th that Twitter’s “long-term potential will be an order of magnitude growth compared to its current value.” It’s just that Twitter is facing a loss of active users. Data shows that “heavy users” account for less than 10% of Twitter’s total monthly users, but are the source of 90% of tweets and half of Twitter’s global revenue.
Musk has claimed to make drastic reforms to Twitter, including eliminating “fake accounts” and expanding “freedom of speech.” Some worry that Musk could foster hate and extremist speech if he loosens control of the platform.
Another point of concern to the outside world is whether Musk will “lift the ban” on former US President Donald Trump. Twitter banned Trump’s account for inciting violence after Trump supporters violently stormed the Capitol on Jan. Musk has called the move “stupid,” saying his takeover of Twitter would overturn the decision.
Musk announced in 2019 that “I hate advertising”, but on the day of the acquisition, he sent an open letter to advertisers “calling out”: “Twitter is determined to become the most respected advertising platform in the world, which will broaden your brand influence, boost business growth.”
Still, if Musk does bring Trump back to Twitter, it could irritate moderate and liberal users, and keep many mass brands at bay, says advertising industry personality Marc DiMassimo.
Twitter’s roughly 7,500 employees are concerned about the risk of layoffs. However, Musk denied rumors of laying off 75% of his workforce at a Twitter staff meeting, according to Bloomberg.
Musk also said that he hopes to use the Twitter platform to create an “all-inclusive” super software “X” that integrates social media, messaging, payment, shopping and other functions. Industry insiders say that such supersoftware has not yet appeared in the United States because of various legal and competitive obstacles. (Shen Min)