Elon Musk buys Twitter: how will the social network change?27 April 2022
It is news of these hours that the Board of Twitter has accepted the offer of Elon Musk: the owner of Tesla has thus conquered Twitter and will soon withdraw it from the U.S. Stock Exchange. The most influential social network in the field of information, with over 200 million users, becomes the exclusive property of the richest man in the world: a highly capable and brilliant entrepreneur, ideologically liberal and libertarian, allergic to the rules, who has already said he wants to revolutionize the platform, eliminating any limit on access on the basis of a radical interpretation of the free speech guaranteed by the First Amendment of the American Constitution (rule that, in fact, concerns the public authorities, not the private ones).
The short-term consequences, already taking place, include the return to Twitter of members of the ultra-right whose account had been blocked for violating the network’s terms of service, with incitement to violence that resulted in the assault on Congress 15 months ago. Donald Trump, that was also “silenced” at the time, has already said that he does not intend to return to Twitter, given that in the meantime he has built his own social network, Truth Social. It is not certain that he will not change his mind, given that, among other things, his new communication company is struggling to take off. The former president’s quick statement may also have an economic motivation: Truth Social is headed by a Spac, a sort of special company controlled by investors friends of Trump, which lost 44% of its value in the hour following the announcement of the sale of Twitter to Musk.
The purchase of such a powerful information platform by a visionary industrialist who is also an accidental capitalist and a skilled and innovative influencer with 83 million followers, accustomed to intervening on everything regarding the future of civilization, can however have even more relevant long-term consequences both on journalism and in the field of politics.
On April 2, Musk had offered $43 billion in cash ($54.20 per share) to take over the company, but Twitter’s directors had reacted to the proposal, although very convenient, by building barricades: they had started looking for other possible buyers and had given the green light to the issuance of a “poison pill” (a financial technique that makes an acquisition more expensive and complex). It seemed that the head of Tesla and SpaceX had to prepare for a long siege, but everything has changed in the last few hours with a series of twists and turns. First of all, Musk swept away the skepticism of those who considered him a rich but not liquid entrepreneur (his assets are all in shares) demonstrating, in black and white, to be serious: he presented to the SEC (the Stock Exchange Authority in the United States) a plan to finance the acquisition based on two loans from Morgan Stanley and other banks for a total of 25.5 billion dollars, while another 21 billion will come from the sale of Tesla shares. Then the Republican Party moved in support of Musk with a letter from 18 members of the House Judiciary Committee that, in essence, threatens to open a parliamentary investigation into the behavior of the company’s board in the future. Finally, Musk spoke personally with several large shareholders of the company explaining in detail his projects: to make Twitter less dependent on advertising by converting it into a paid service (2 or 3 dollars a month), with the possibility of editing posts. These shareholders then told the company’s chairman, Bret Taylor, that they support Musk’s proposal. Taylor met with the head of Tesla, and after some contacts between Musk and other board members, the Board of Directors finally decided for the yes without even waiting for the deadline of April 28, when Twitter will communicate the data for the first quarter of 2022. Probably very negative, predicts CNBC guru Jim Cramer.
Twitter’s founder, Jack Dorsey was among the first to publicly speak out in favor of Musk. At age 45, Dorsey is a very influential American entrepreneur: he founded the company that tweets in 2006 and was its CEO several times, until 2021. His statements were reassuring in a series of tweets. Dorsey wrote that although on an ideal level he does not believe that Twitter should be owned by a single person, “Elon is the only solution I trust, just as I trust his mission to extend the light of awareness,” whatever that means. More concretely, Dorsey said he shared Musk’s goal of making Twitter more inclusive and transparent, as anticipated in the press release with which Musk announced the imminent purchase of the company. “The road is the right one,” Dorsey concluded. “I believe in it with all my heart.”
Oscar Giacomin / General Manager, Facto Edizioni
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