Elon Musk offers to buy Twitter

 
Quadrewple
 
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Quadrewple
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14 April 2022 15:33
 

Any thoughts?

I want to like Elon but his public image has been carefully crafted for years to the point where I believe he is surely an asset to the people who really run things and control the money supply.  An asset in that his insane popularity will be leveraged to push forward the “Great Reset” stuff the WEF is always talking about and controlling the biggest speech outlet is one way to do that

At the same time, he’s no worse than the scumbag billionaires who are controlling Twitter right now

I’m torn

 
 
weird buffalo
 
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weird buffalo
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15 April 2022 13:37
 

I’m confused… are you saying the scumbag billionaires who control Twitter now are NOT part of the WEF “great reset?”  That would seem counter intuitive, since Morgan Stanley and the BlackRock Group both participate in the WEF and are both currently 2 of the top 4 shareholders in Twitter.  So, it would seem strange for the current ownership of Twitter to be opposed to Elon Musk taking over Twitter… if that was their plan.

And of course, other major shareholders, like Ark Investment and Jack Dorsey are public supporters of Musk… and Dorsey is of course the CEO of Twitter.

Also, I don’t think you understand what the WEF means by it’s “Great Reset”.  Some aspects of it are specifically curbs on corporate power and moving away from neoliberalism and free-market fundamentalism.  This would actively take power away from giant corporations.

And I’m not necessarily in favor of their vision of the future… as I’m not very well versed in it.  My suspicion is that they still want more corporate power than I’d be happy with.  But if you’re going to complain about something… you should at least have an inkling of what it actually is.

 
weird buffalo
 
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weird buffalo
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28 April 2022 10:49
 

From a business perspective, his decision to keep pushing this is clearly a bad one.

For perspective, Google had approximately $250 billion in revenue last year, Facebook’s revenue was a little under $120 billion, and Twitter’s was $5 billion.  It is a profitable business, but capturing 100% of it’s current profit would take about 20-22 years to recoup the current offering price from Musk.  That’s a long time be down billions of dollars.

Twitter generates a pretty decent income per employee right now, at around $1,000,000/employee.  Sidenote: this revenue/employee ratio is 25% higher than Tesla.  Twitter is already a more efficient/successful company than another company run by Musk currently, though both of these are better than many more traditional large corporations (though those corporations are often much more stable and significantly larger).  Laying off employees is unlikely to make the company much more money.  The moderation staff is not highly paid, and so the change in revenue/profitability is likely to be insignificant compared to the billions he is paying for the company.

Twitter is a pretty established brand.  Most people know what Twitter is, and they have already chosen to use it or not use it.  While it does have the lion’s share of similar platforms (truth social and gab are not relevant competitors even though they’re similar formats), most people who don’t use twitter use very different platforms like facebook, instagram, reddit, pintrest, etc.  Getting new users to join Twitter would help, but most people who don’t use twitter don’t do so because they feel it is “too moderated”.  Those people are already on platforms like Gab, and that population is exceedingly small compared to Twitter, which is already significantly smaller than platforms like Facebook.

He could try charging more for advertising, but advertisers mostly pay to be on Twitter because it’s cheap right now.  The appeal of Twitter is not significant because so few people use it.  Hundreds of millions of people use Google and Facebook, so advertisers go there because that’s where the consumers are.  Twitter has roughly 20% of adults in the US using it.  Facebook has roughly 70% of adults in the US.

The biggest and likely best option is to charge people for tweeting.  Twitter could remain free to read, but create a pricing structure for sending out tweets.  This of course is commodifying “free speech”... which makes it “paid speech”. Sure, you can say what you want, but only if you can pay for it.  This would of course alienate many users, and specifically require different pricing in different countries, not just because of currency, but income levels as well, or it would make it nearly unusable if people in Malaysia has to pay US prices, which again limits Twitter’s appeal to it’s audience and advertisers.  A more inclusive pricing structure would then also make less money overall, and poor countries would provide little to no revenue and make it harder to break into new markets, which Twitter already struggles with.

There are enough investors who think this is enough of a bad idea that Tesla stock is taking a hit, because they know Musk’s wealth and ability to make this deal happen is tied to his ownership of Tesla stock.  Even if some major banks are lending money for the deal, they’re going to want something in return, especially if Twitter itself is not making enough money to pay back those loans fast enough.  And if something bad happens to Twitter’s business model, there is very little equity or assets to liquidate to recover $44b.

 
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01 May 2022 14:06
 

From my measly uninformed perspective, Musk buying Twitter doesn’t make much sense as an investment, but Musk has proven skeptics wrong before.  And the people running Twitter aren’t nincompoops either, so it seems to make sense to sell at the offer price.  How will Musk change Twitter to make more money?  It seems removing moderation in the name of free speech will turn Twitter into a cesspool of trolls, malcontents, and death threats, which may turn off subscribers.  And if subscriber numbers drop then so do advertisers.

Maybe Musk is buying Twitter out of spite to wreck the brand?  But I don’t use Twitter, nor am I a billionaire with access to the resources Musk does, so the story is one of fascination and will have little direct effect on me.