When Musk decided to buy Twitter, he didn't have a business plan, just some ideas about how it should work.
Everyone has ideas, but he also had money to buy them.
The operation was rather the whim of a hyperactive billionaire in the social network.
That explains why after thinking twice about it, he started looking for excuses to back down.
Seeing that he didn't have much of a chance of getting out of the deal he signed, he has now decided to move on.
If there are no new surprises, he will soon be the owner of Twitter.
He will arrive after viciously attacking the company and its executives and after leaving some clues in court documents and public statements about what he intends to do with the social network.
In his head is to establish a paid subscription model or eliminate permanent vetoes like Donald Trump's.
"The purchase of Twitter is an accelerator to create X, the application for everything", was the first tweet of the tycoon about his second 180 degree turn by which he returns to the starting point, buying the social network for 44,000 million dollars .
Musk has not given any further explanations, but in the past he has shown his admiration for the Chinese application WeChat, which evolved from a messaging service to a multinational platform with means of payment, electronic commerce, health, subscription management and all kinds of services. , almost essential for daily life in China.
Buying Twitter is an accelerating to creating X, the everything app
— Elon Musk (@elonmusk) October 4, 2022
In addition, during the presentations to get investors to add to his offer and financing from banks, Musk had already anticipated that he wanted to have 104 million paying subscribers of the mysterious application X by 2028. He also aspires to multiply the number of users in general of the social network.
From 217 million at the end of 2021 to 600 million in 2025 and 931 million in 2028. Quite a challenge, after which Musk indicated that he would consider taking Twitter out on the stock market again.
The eccentric and controversial billionaire is a born entrepreneur, who founded Paypal, the electric car company Tesla and the aerospace company SpaceX.
Now, within Tesla, he has embarked on a project to create large-scale humanoid robots that he will initially put to work in his factories, although development is still very green and for now what he has shown is a rather clumsy and awkward device. very limited functionality.
Refounding Twitter with something new will surely appeal to you more than just tweaking it.
Whatever “X, the application for everything” is, for the time being his most immediate task is to take the helm of Twitter, a company that has worn itself out in the battle with what will now be its new owner.
The departure of employees in search of other opportunities has accelerated and those who remain fear that the company's work culture will change, so they anxiously await the arrival of Musk, pending an agreement to be reached and the trial in Delaware Court where the company sued the richest man in the world.
Since Musk's new announcement, lawyers on both sides have been hastily negotiating to close the deal or a new deal that Twitter wants fully ironclad.
for now,
Musk's stated goal from the start was to rid the social network of spam and bots that annoyed him as a user.
He said that the purge would have to be done without listing the company because he was going to make "the numbers look terrible."
That was why the excuse that he wanted to break the agreement because he had discovered that there were many false or inactive accounts was so unbelievable.
Arguing about the importance of users in his countersuit before the Delaware court hearing the case, Musk hinted that knowing the actual number of users was critical to establishing a subscription business model.
"Musk believes that Twitter's advertising-based revenue model is outdated," the lawyers said in their brief.
“Before the merger deal, I believed I could unlock Twitter's true potential by shifting from the ad-only model (in Q2 2022, advertising represented more than 90% of revenue) to other forms of revenue, such as an ad-only model. hybrid of subscription for verified users and enabling payment and monetization tools for creators,” it added.
And elsewhere: “Musk understood that each mDAU (monetizable daily active users) represented an active Twitter user who could be convinced to pay a nominal monthly fee for the service.”
Twitter already has a subscription service (Twitter Blue) in some countries with some extra features and the ability to further customize the user experience, but Musk has never been very enthusiastic about that model.
Trump's return
The businessman has also said he would allow Trump to return to the social network, where he was a hyperactive user.
He was banned after the assault on the Capitol on January 6, 2021, since the network interpreted that the hoaxes and proclamations he launched incited violence.
Since then, Trump has taken up residence on Truth Social, Twitter's replica of him, and it's unclear whether or not he'll return to the original.
Between Musk and Trump there has also been some verbal spat.
Trump mocked the businessman and his "rockets to nowhere" and the tycoon replied to the former president that it was time for him to "sail into the sunset."
In any case, it is worth thinking about the return to Twitter of many of those who were permanently suspended.
Given its resistance to content moderation and its speech in favor of almost unlimited freedom of expression (which it does not practice within its companies), the risk of the platform becoming an instrument of propaganda and electoral manipulation resurfaces.
In the messages that have emerged during the judicial process, the tycoon was only willing to censor "those who explicitly advocate violence."
That can make room for conspiracy theorists, hoaxers and hate speech.
The trolls will have the doors open.
"Twitter has become a kind of public square in fact, so it is really important that people believe and perceive that they can speak freely within the limits of the law," he explained in April, just as he launched his offer. .
Musk had also proclaimed his desire for a button to edit and correct messages.
The company has started testing it before its arrival, for now only to be used for 30 minutes after the original message and a limited number of times, leaving the editing history available.
The tool is designed to correct typos and add some oversight.
It will be necessary to see if Musk thinks it is enough.
The tycoon had also responded to a long Twitter thread pointing out the need for longer messages.
That this will be applied is another thing.
Another idea that he has repeated, this time in a more consistent and thoughtful way, is his wish for the algorithm to be transparent and open source.
Millionaire compensation
After the public discussion on the social network in which Musk ended up replying with the emoji of a smiling poop and all the confrontation of recent months, surely the CEO of Twitter, Parag Agrawal, has few illusions of continuing to direct the company.
After openly criticizing the current managers of the company, Musk has hinted on several occasions that he will personally take charge of operations.
Agrawal, however, will not leave empty-handed.
The merger prospectus revealed that he would be entitled to a golden parachute, as such severance pay is called, of $60 million.
Also shielded are the financial director, Ned Segal, with 46.4 million dollars;
Vijaya Gadde, chief legal officer (whom Musk has accused of having a leftist bias), with 21 million, and Sarah Personette, director of clients, with another 20 million.
Musk tried to negotiate a price cut
Tycoon Elon Musk has signed a full-fledged capitulation by proposing to buy Twitter at the originally offered price.
Before giving up, he tried to negotiate a share price downgrade without success, The Wall Street Journal
reported on Wednesday .
The New York financial newspaper assures that the lawyers of both parties held a series of remote conferences in recent weeks and did not reach an agreement.
Musk not only saw himself losing, but he was also showing that he had not made all the messages and communications made around the operation available to the other party, as was his obligation.
The tycoon also had to face an interrogation by Twitter's lawyers this Thursday and Friday.
The process was also exposing his fellow travelers, friends and allies, including Oracle founder and boss Larry Ellison, who is also a Tesla adviser;
Paypal co-founder Jason Calacanis, investor in Uber and Robinhood and partner in the operation, and David Sacks, co-founder of Paypal, who responded to the request in a not very decorous way on social networks.
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