Elon Musk followers like to say their hero is all the time enjoying four-dimensional chess. Regardless of how chaotic his actions, they consider the billionaire Tesla boss has secret plans too sensible for the remainder of the world to know. Parsing his $44bn deal to take social media platform Twitter personal requires an analogous degree of religion.
Musk has pinned his supply on the necessity to defend free speech. His curiosity was reportedly piqued by a suspension of satire account Babylon Bee (which simply so occurs to have revealed flattering jokes about Musk). It’s an costly stand to take. To facilitate the deal he’s placing up $21bn of fairness commitments and $12.5bn of loans towards his personal Tesla inventory. All for a gradual rising 16 yr previous firm that reported a internet lack of $221mn final yr.
Then once more, Musk is probably not shopping for Twitter for all of its 217mn accounts. His curiosity may very well be only one — his personal. He’s a prolific Tweeter with almost 84mn followers who makes use of Twitter as a supply of publicity for his corporations. Proudly owning Twitter ensures he’s by no means censored. Reinstating sure banned accounts, together with President Trump’s, may rating political factors sooner or later too.
Discovering a enterprise case is tougher. Accepting the supply means Twitter discovered no viable different supply and did not persuade its sole bidder that it was value greater than $54.20 — almost 30 per cent beneath final yr’s excessive level. This isn’t the outline of a flourishing enterprise.
Musk’s present for consideration means person numbers will most likely develop. However to lift promoting charges Twitter must extract extra details about customers — tough when privateness issues are rife. Eradicating moderation dangers damaging advertiser relations too. Advertisers together with Walmart, Starbucks and Coca-Cola have boycotted YouTube and Fb over content material issues. They might add Twitter to that record.
Maybe Musk has a plan to remodel Twitter’s enterprise fully. Possibly it’ll someday be a crypto funds firm. Or a meme inventory buying and selling platform. Or maybe one of many platform’s largest customers simply needs to personal it.