Freed Twitter is an illusion. The bird has been freed, where is the bird now? The question rubbishes Elon Musk’s euphoria over concluding his blockbuster Twitter deal on 27 October. Clearly, Musk’s elation was premature. Defying commercial logic, the richest individual on this planet took great delight in acquiring a potential liability. Musk’s Twitter acquisition may gold-plate his profile, will it fatten his personal wealth? Quite doubtful. Isn’t 44 billion USD an exorbitant price for lifting a falling face and buying a plated profile? The planet’s accidental ‘musketeer’ does not have answers.
Inability to Squeeze the Lemon
Nevertheless, Musk is restless to prove acquiring Twitter was a right decision. Having failed to wriggle out of a thoughtless deal, despite months of feet-dragging, Musk is desperate to demonstrate he can make money out of a lemon now. Impatient, Musk sacked his four senior executives on 30 October, followed by a wholesale sacking of his entire board the following day, leaving him behind as the lone wolf in the crumbling Twitter pack. Egged on by eccentricity, Musk styled himself as Chief Twit on his Twitter profile, changing it later to a mouthful jargon Twitter Complaint Hotline Operator. https://www.seattletimes.com/business/musk-emerging-astwitters-chief-moderator-ahead-of-midterms/
Fancy designation apart, the 51-year-old Musk may be realising now he may not be able to squeeze the Twitter lemon profitably. Shelling out a whopping 44 billion USD for a tech player in the social media space was nothing but audacious impudence. Imprudent as well, as the Twitter deal was struck when tech stocks were melting on the Street. With Twitter’s current valuation tanking at 41.09 billion USD, much lower than Musk’s payment for acquiring the company, can he hope to get much juice out of his new lemon? Musk could well end up having a milkless cow in his corporate stable. https://companiesmarketcap.com/twitter/marketcap/
Twitter Liberalists’ Fears
Forget Musk’s fancy lemon for the moment, will the Twitter buyout delight the hearts of its hungering daily users? Perhaps not, if the assorted post-takeover statements of Musk are any indication. Despite Musk the Musketeer projecting himself as a self-styled champion of ‘free-speech absolutism’, he has been waffling over the free-speech issue, of late. Musk’s pre-takeover promises of easy content-moderation norms are gradually giving way now, post-takeover, to a not-free-for-all approach.
Musk did assert recently Twitter would not end up as a platform “where anything can be said with no consequences”. Yet, the liberalists among the Twitterati fear Musk could remould Twitter into a freewheeling platform for purveyors of hate, propagators of falsehood and disseminators of disinformation. Such behavioural uncertainties are sure to drive bonafide users and advertisers, besides liberalists, away from the microblogging platform. https://www.politico.com/news/2022/10/27/elon-musktwitter-00063766
Milking the Blue-Check Program
Though Musk is putting up a stoic front, he is planning to fine-tune digital ads on Twitter. Currently, Twitter makes money largely from these ads. Despite his much-amplified hate-advertising stance, Musk is now using his forked tongue to say he believes in ‘advertising which can delight, entertain and inform’. Embracing ambivalence, typical of him, Musk is projecting himself now as a votary of ‘highly relevant ads which are actually content’. https://cybernews.com/news/musk-bought-twitter-to-help-humanity/
Alongside, Musk is trying to milk Twitter Blue, the program which verifies Twitter accounts. He is planning to raise Blue-Check program’s monthly fee to 8 USD, up from 4.99 USD. Over the long haul, verified accounts, which do not pay for Twitter Blue, will be ineligible for the blue-check marks. On a last count, there are more than 0.4 million verified accounts on Twitter. Musk is eyeing these accounts for augmenting his revenues. Will this gamble work? Quite unlikely. As Twitter users drop, though not on a huge scale, the drop is sure to apply the squeeze on user-content and thus on advertising revenues. https://www.reuters.com/technology/musksays-twitter-will-charge-8-blue-tick-2022-11-01/
Anger Over the Layoffs
In a bid to soften the effects of this squeeze, Musk is now training his guns on Twitter’s bloated workforce of 7,500 and rising employee cost. Undeniably, Twitter is overstaffed. The San Francisco-based tech major has 1.5 employees for every USD 1 million revenue. The corresponding figure for Meta is 0.6. Musk is on his way towards booting out 75 per cent of Twitter’s workforce. Losing no time, this was the first act Musk enacted after the takeover. He issued pink slips as if there was no tomorrow. Reports indicate Musk has made Twitter shed, as on date, a wee more than three-fourths of its workforce, including its top brass and the entire board. https://www.indeed.com/companies/compare/Meta-dd1502f2-vs-Twitter-b1f359487c26ba41-111a5d128be93e2e
However, simmering anger over the layoffs is not discouraging protagonists of Musk from arguing he has bought Twitter not for making money, but for upholding free-speech absolutism. If Musk pays scant attention to making money, how will he be able to sustain Twitter and realise his ‘noble’ ideals? If Musk does not care about Twitter’s productive efficiency, how will he be able to retain his new appointees and prevent a possible premature shutdown?
Questions Elicit No Answers
If Musk abhors profit-making, how will he be able to reward his financial backers, who are Saudi and Qatar sovereigns? Will these backers be prepared to put in money in a no-returns enterprise and continue to fund Musk’s narcissistic ego trip? With Musk as the lone director on its board, will Twitter inspire its current and prospective investors with confidence? https://techstory.in/saudi-prince-dorsey-and-qatar-to-invest-in-twitterafter-musks-takeover/
These arguments point towards Twitter ending up as an ads-hating personal opinion-platform of Musk. Will Twitter transform into a rare microblog with Musk as its sole major user (109 million followers) and lone director? Will this not lead to an exodus of users? In this case, will Twitter be able hit Musk’s revenue projections of USD 26.4 billion and 931 million users by 2028, up from its current 5.08 billion USD and 200 million users? Shunning advertising revenues, how will Musk service his takeover loan of USD 12.5 billion by shelling out more than USD 1 billion annually towards interest? https://www.nytimes.com/2022/05/06/technology/elon-musktwitter-pitch-deck.html
Already, Twitter’s cashflows, at less than USD 1 billion, are thin and discouraging. Will Twitter be prepared to forego its advertising sales, which account for more than 90 per cent of its total revenue? Will Musk say no to Amazon, HBO, IBM, Mondelez and PepsiCo, Twitter’s top five advertisers today? https://www.mediamatters.org/twitter/these-top-advertisers-canstop-musks-twitter-supercharging-online-radicalization How will a company with eight unprofitable years in the last decade plan to progress? Many such questions elicit no answers from Musk. As usual, he is tall on claims and short on details.
Dishearteningly, a recent research shows many progressive personalities are losing their Twitter followers fast since Musk’s Twitter takeover. The former American President Barack Obama figures among them. If respected moderates thus keep leaving Twitter for good, the far right is sure to spread its fake narratives with immense success. Such a prospect is scary. Musk was right when he wrote on Twitter, after consummating the takeover deal, “The bird is freed”. Alas, the freed bird is lying battered and bruised outside the cage now.