Volume IconHow will Elon Musk's takeover of Twitter change the public square?

Elon Musk finally entered the Twitter headquarters in San Francisco last week, pulling off a difficult feat. Here's an analysis of how Twitter will transform under Musk in the days to come?

Elon Musk

When Zimbabwe defeated Pakistan by one run to register their first Super 12 victory at the T20 World Cup, Zimbabwean president and Pakistan’s prime minister engaged in some friendly Twitter banter over the match. Exchanges like these encapsulate the beauty of Twitter. 

This is where heads of governments joke, world leaders debate, politicians trade barbs, corporate big-wigs get closer to their customers and activists moblilise. All of this is documented and brought to the mainstream by journalists, one of the most active user groups on Twitter. 

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Yet, it is not the world’s biggest social network. It had 237 million daily active users and, reported a net loss and a marginal decline in revenue in the April-June quarter. 

The user base is tiny relative to both Facebook and Instagram, which boast of global daily active users just short of 2 billion each.

The platform’s third-most followed person has turned its owner after six months of public and legal wrangling over the $44 billion acquisition deal. Elon Musk, who is also the CEO of carmaker Tesla and rocket company SpaceX, described Twitter as the digital town square where matters vital to the future of humanity are debated.

Soon after taking over, the world’s richest man reportedly fired CEO Parag Agrawal, CFO Ned Segal and legal affairs and policy chief Vijaya Gadde. He accused them of misleading him and Twitter investors over the number of fake accounts on the platform.

“The bird is freed,” Musk tweeted a few hours later on Friday, in reference to Twitter’s logo.

In response, a top European Union official warned Musk that Twitter should ‘fly by the bloc’s rules’.
The EU’s Digital Services Act levies hefty fines on companies if they do not control illegal content. 

India’s IT minister Rajeev Chandraekhar too said that Twitter must comply with the country's existing and upcoming new IT rules and Musk’s takeover will not change that.

Twitter is locked in a legal battle with the Indian government. It has challenged the IT ministry’s orders to remove content and block multiple accounts, arguing they were “overbroad, arbitrary and disproportionate”, and failed to give notice to authors of the content.

Lloyd Mathias, business strategist and angel investor says, loosening moderation can make advertisers wary. Musk’s other firms can face govt pressure due to Twitter ownership. 

Ahead of the close of the deal, Musk said he wants Twitter to be “the most respected advertising platform”. This is coming from someone who once tweeted “I hate advertising”.

In an open letter to advertisers, Musk has said, “Twitter obviously cannot become a free-for-all hellscape, where anything can be said with no consequences.”

Musk has vowed to restore “free speech” on Twitter. The self-described free speech absolutist, however, also said he wants to prevent the platform from becoming an echo chamber for hate and division.

Still, Musk reportedly intends to do away with permanent bans on users, potentially allowing people such as former US President Donald Trump and Bollywood actor Kangana Ranaut to rejoin. 

Trump was banned due to the risk of further incitement of violence following the storming of the US Capitol while Ranaut was banned for repeatedly violating Twitter’s rules on hateful conduct and abusive behaviour.

In an indication of the challenges ahead, Ranaut on Friday applauded Musk's takeover on Instagram and shared requests from fans to have her account restored.

Among Musk's top priorities is eliminating spam bots and authenticating all humans on Twitter. He has always claimed that the number of spam accounts is bigger than what the company stated. He had even threatened to walk away from the deal citing the miscounting of spam accounts. He has promised to “authenticate” all humans on the platform.

Musk had also suggested that Twitter’s algorithm needs to be made open source to increase trust as it was “quite dangerous” to have “tweets be mysteriously promoted and demoted” and have a “black-box algorithm”.

While Musk is trying to gain the trust of ad buyers with his latest communication, he wants to find new sources of revenue. 

Ideas he brought up included charging a fee when a third-party website wants to quote or embed a tweet from verified individuals or organisations. He also suggested that Twitter could charge a small fee for commercial and government users.

Ad sales account for more than 90% of Twitter's revenue currently.  Musk has also spoken about his desire to transform Twitter into a super-app called X, inspired by China’s WeChat.
  
He reportedly told investors that he plans to build an "everything app" that will sell premium subscriptions to reduce reliance on ads, allow content creators to make money and enable payments.

Lloyd Mathias, business strategist and angel investor, says turning Twitter into super-app seems difficult. Monetising social media platforms without ads is a challenge. 

Musk has provided little clarity over how he will achieve the ambitions he has outlined for Twitter, which have sometimes appeared far-fetched or contradictory.
  
Just as Twitter's 7,500 employees are anxious about Musk’s impending cost cuts at the company, millions of users are eager to witness changes including new features that Musk will bring to the platform.

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First Published: Oct 31 2022 | 7:00 AM IST

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