At Futuri, we have worked with Twitter and their technologies for many years. We look forward to Elon’s takeover! A breath of fresh air for the media industry.
Elon Musk is in many ways the perfect Twitter celebrity. He’s a polarizing figure with a knack for making incendiary headlines. He’s influential and interesting enough to draw the world’s attention, but not so famous as not to participate in Twitter’s many running jokes. He’s as irreverent as the world’s richest man can be.
Recently Musk acquired a 9.2% stake not because Twitter is a well-performing stock or an investment. The $2.6 billion acquisition only represents 1% of his net worth. He is on a red-pilled-driven mission to protect free speech. He has called himself a “free speech absolutist”, opposed to any restrictions on what someone can say online.
So what can we expect of him and Twitter next?
Because Musk is looking into a free (speech) platform, it will encourage and create a free exchange of ideas, and as a result, the user base will grow, as will ad revenues.
Twitter stock has been lagging behind its direct competitor Meta. The social media company has been floundering after going public. Their ad results are decelerating.
Following Musk’s acquisition of 9.2% stake, the stock price gained significantly for the first time since 2013. Investors felt optimistic about the move, feeling that it would rejuvenate the sickly business. In fact, the news of Musk taking a board seat strengthened it more. But when it was said that he wasn’t resuming the board seat the stock price descended. This is to indicate that where goes Musk there goes Twitter.
Twitter leadership is now in a precarious situation. They’ve embraced – at least publicly – Musk and rejecting his deal would likely send the Twitter stock into a death spiral.
Perhaps then Google or Larry Ellison buy it at a lower price… but shareholders will not see the same rewards.
A subscription model will create real value. (see #4)
There are many reasons why we expect that Elon Musk will be an activist for free speech. He is the CEO of Tesla and the CEO of SpaceX. SpaceX already has a satellite in space that provides the internet to all of us. It is called Starlink. He recently employed Starlink to bring the Internet to millions of Ukrainians.
He started Tesla, one of the most disruptive companies in the world today. His company built a software car that drives people around without any human assistance.
Elon Musk recently got into the cannabis industry when he bought a hemp farm in Texas. He also just launched two satellites into space funded by his own money and not by a venture capital firm.
And now he’s taking over Twitter as well.
Musk says he isn’t political. This obviously isn’t the case as he is showing with deeply idealistic moves that – yes – are benefiting humanity.
Money will pour in with fewer restrictions and oversight. Twitter will also overcome Facebook in campaign/issue ad revenue. Every politician and super pac will spend huge amounts on a platform that doesn’t restrict speech.
With Elon Musk as the CEO, Twitter will have a lot of influence compared to other social media platforms. Although Musk isn’t interested in daily politics, his campaign contributions, and tweets speak volumes.
And given that he has about 80 million followers makes him an influential voice regardless. If he can move the markets as he did with dogecoin and crypto at large, he can move the needle when it comes to elections. Two separate scenario we can expect:
Musk floated the idea of a subscription model, suggesting a $3 monthly fee in exchange for a highly coveted blue checkmark. When high demand meets limited and carefully regulated supply, we can only imagine how many users will flock to pay a measly three bucks for the privilege of being verified. Just do the math. In 2020, Twitter raked in $3.72 bn in revenue. What’s 20m users paying $3/month?
Sure, subscription is a tradeoff and advertising will drop, but it is my belief that a subscription model will create a highly engaged user base that will ultimately turn Twitter into the largest platform of active users, leaving platforms like Reddit in the dust.
The Zuck is often portrayed – for some good reason – as personifying all the evils of Big Tech. Recently released documentary investigates why Zuckerberg made an unprecedented $400 million investment in the 2020 presidential election and follows the money through official tax documents and seeks to set the record straight about exactly what happened.
Indeed, Facebook – whether Zuck’s donation or Cambridge Analyhtica – is mired in controversy. With Musk joining Twitter, it’s likely that Facebook continues to polarize popular opinion and bleed younger users to Twitter and TikTok. Facebook has been in the crosshairs of DC republicans and with Musk – a darling of sorts of many conservatives – joining Twitter, it’s unlikely that Twitter will face the kind of regulatory scrutiny that Facebook is knee-deep in.
With Musk’s recent Twitter activity, the question may arise: will this make it more difficult for competitors to break through and gain some sort of network effect?
Whether Dave Rubin’s Locals or Trump’s Truth Social, or Parler, Musk’s entry into the mix could make these aforementioned ventures redundant. The premise and raison d’etre for platforms like Locals is free speech. If speech is free on Twitter, why take the time to join a competing platform?
Of course, if Musk is distracted and/or unwilling to fight for free speech, new platforms will have a place in the market.
With bitcoin maximalist Jack Dorsey and crypto generalist enthusiast Musk, Twitter will increase its position as the New Finance platform. Twitter will be the adoption gateway.
Twitter will attract more high net worth social users, more upward moving professionals, and folks who are or wish to become movers and shakers. No other social media platform has done more to advance crypto than Twitter. Sure, advertising is still an issue, but Crypto Tips and Dorsey’s unbridled bitcoin enthusiasm aren’t going away and Musk will likely accelerate both Twitter’s crypto journey and the wider, mass adoption.
Musk’s decision to take a piece of Twitter isn’t about making a better product in terms of the platform’s functionality or UX/UI. Tiny tweaks that may be expected by many, are a distraction from the main battle.
Musk has given multiple interviews – from Joe Rogan to 60 minutes – where he speaks openly and honestly about his world view. The world is about mass-scale – not incremental – change. The goal of putting a man on mars and already achieving one goal by revolutionizing the car industry, Musk isn’t looking to make 20% on his investment. He is taking on those who wish to regulate speech and will likely succeed.
Had Jack Dorsey not stepped down and had Parag Aggrwal not been appointed the new CEO, it is highly unlikely Musk would’ve invested in Twitter.
While Musk will want to focus on making Twitter a better product, whether in terms of design or functionality, the new CEO, Mr. Agrawal, is the real target. Agrawal has indicated that free speech isn’t on the top of his agenda.
For Musk, Twitter is his primary communications channel and which he seems to enjoy the most. Musk is engaged in a direct conversation with his 80 million followers. The power of this dynamic likely functions as inspiration for Musk and a crowdsourced wealth of information that has shaped his political and philosophical views.
Musk will want to not only maintain this conversation, but to safeguard it. This means, simply put, that he must purge Twitter of the anti-free speech culture.
Joe Concha, writing for The Hill, says “Musk may “inflict damage to the company’s culture” — a “culture” that has freely embraced censorship while shunning due process. If Musk is a threat to that, it’s a good thing.”
In the same column, Concha cites a recent survey by the nonpartisan Pew Research Center, according to which “just 10 percent of Americans surveyed believe social media has had a mostly positive impact on the country, while two-thirds say it’s had a mostly negative impact”.